Things to Learn Before Buying Real Estate in North Cyprus

Turkish Republic of Northern Cyprus is one of the advantageous points for those who want to invest in real estate. In a country with a rapidly developing economy, there are some issues to learn before making the decision to purchase real estate:

Deed Types

There are 3 different types of title deeds in the Turkish Republic of Northern Cyprus. Before purchasing, you need to find out which title type the real estate has.

• The most trouble-free title deed type in the country is the Turkish title deed.
• The equivalent title deed type is the title deeds of real estate given in return for the real estate left by people who moved from the South to the North.
• Allocation deeds belong to immovable properties allocated by the state for use by people who do not own real estate.

Council of Ministers Permission for Foreign Investors

Non-citizen investors must first obtain permission from the Council of Ministers to purchase real estate in North Cyprus. The result of the application made to the Council of Ministers takes between 6 and 12 months. Foreign investors have the right to acquire 1 real estate in the Turkish Republic of Northern Cyprus. This real estate can be a property not exceeding 5 decares or a land not exceeding 1 decare.

Taxes

It is useful to learn about the tax amounts to be paid to avoid any surprise expenses during the purchase process. There are 4 types of taxes to be encountered when acquiring real estate in the country.

• Title Deed Transfer Fee: The title deed fee rate is 6% for TRNC and Turkish citizens, and 12% for foreign nationals until 31 December 2023. This amount is paid by the buyer. However, if the buyer is not making the purchase for commercial purposes, he can pay this amount with 50% discount for one-time.
• Value Added Tax: The VAT amount is 5%. This amount is paid by the buyer. If the seller is not selling for profit, VAT is not paid on second-hand property and land sales.
• Withholding Tax: This type of tax is paid by the seller. If the person making the sale is seeking profit, this rate is 4%. If there is no profit intention in the sales transaction, this amount decreases to 2.8%. Non-profit sellers are exempt from this tax once in their lives.
• Stamp: If the sale is based on a project that has not yet been completed, the contract is recorded in the land registry office. A 0.5% stamp fee is charged for this transaction that formalizes the sale.

If a house is purchased, electricity and water connection expenses will be added to the fees to be paid.

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