Dispute over Property Sales to Foreigners Continues. Foreigners Come as Tourists and Practice Real Estate in Turkey
May 31, 2007 -
The Realtors in the tourism areas state that the foreigners that have previously come to Turkey as tourists, practice real estate by renting out the Turkish property they have purchased.
There is an increase in the illegal rental of properties, purchased by foreign nationals in the tourist areas of Turkey, mainly in Antalya, Bodrum, Marmaris, Kusadasi, and Didim.
In a statement to the A.A. correspondent, the president of the
Antalya Real Estate Chamber of Brokers, Mr. Seref Saglam, stated
that there is a large volume of unrecorded real estate practice by
foreigners and that the appropriate organizations must take the
necessary actions of prevention.
"Fraudulence increases, when sales are done over the internet. If it
wasn't enough that they work without paying taxes, the unregistered
real estate brokers, take properties priced at 100,000 euros, and
sell them for 150,000 to 200,000 euros, not only cheating the
foreigners, but also, because they are not under supervision, show
the value of the sold properties at a much lower price, and defraud
in taxes. If it is taken notice the size of the industry and the
pressing supremacy of unregistered real estate brokers, the loss in
government taxes is larger than expected."
The president of the Bodrum Chamber of Real Estate Brokers, Mr. Omer Yetkin, explained that there are a large number of foreigners practicing real estate, and further continued to say that "Large companies use those who come to Bodrum for a holiday and practice real estate, to sell through the internet at high prices. These individuals work unregistered. The number of unregistered workers will increase even more during the months of April, May, and June. Prevention must be applied as soon as possible against these unregistered real estate brokers."
"There are 300 registered members with our organization. The remainder work unregistered. We are writing to the municipality, and tax department, regarding this issue. As an organization, we just haven't been able to get ahead of this issue after opening various structured courses. We want the authorities to solve this problem", stated Mr. Yetkin.
"UNDESERVED INCOME INCREASING IN THE SECTOR"
The president of the Didim Real Estate Broker Organization stated that the number of those practicing illegal real estate is increasing day-by-day because the real estate sector has become quite important due to the interest by foreigners.
There has been a huge demand for properties in the important tourism regions such as Didim and Kusadasi, by foreigners in the last few years; and as a result there has been a smashing increase in real estate offices opened by joint Turkish-foreigner partnerships. Mr. Coskun, continued to state that the foreigners have opened up construction companies, using a Turkish partner, to overcome some of the illegalities.
"In order for foreigners to be allowed to purchase real estate, they must obtain permission from the military, and this period can take up to 6 months. For the foreigners to overcome this lengthy waiting period they set up companies on paper, with a Turkish partner, and then it looks like the property was bought under their name. The real estate business in Didim is growing rapidly, and the sole reason for this is high unearned (undeserved) income. This uncontrolled and unsupervised industry provides undeserved income and these types of businesses increase by the day. The large construction companies offering their properties off plan have made agreements through connections with foreigners abroad. The foreigners are in turn selling these properties above the official value in their own country with large agency commissions. This is generating a loss for the government. We estimate that 40 percent of the real estate sold to foreigners is through foreigners practicing unregistered real estate in Didim.
REGISTERED 100, UNREGISTERED 700
The president of the Kusadasi Real Estate Organization, Mr. Huseyin Sentoker, stated that there are 275 registered real estate brokers in the province. In response to the additional 600 - 700 brokers that have come forth, Mr. Sentoker stated this:
"The number of realtors with foreign partners has increased since the reinstatement of the law to sell to foreign citizens. The legal procedures for this subject matter are insufficient. The real estate market went back into motion after the embargo was lifted for foreigners to purchase real estate. And this is the reason why it has drawn the attention of foreign companies to our area. The number of registered realtors with foreign partners is no more than 10. The store owners are other than foreign employers. Partnerships are particularly Irish and German citizens. There is emptiness in the law. The foreigners are purchasing the land, building on it, and selling to foreigners. If they could bring over their own workers and materials from their countries, they would."