TurkeyDownload Full Scorecard
Goal – A comprehensive regulatory regime that is transparent, efficient, simple in its implementation and that leads to accurate reporting of property values and prudent protection from market risks
Core Question: Do market participants feel the overall tax rate is fair and participate in formal transactions? Yes, Strong, taxes in Turkey are moderate.
6.1.1 What is the total property transfer tax including all duties and payments? Strong – 3.3% of property value
6.1.2 What is the overall tax rate on entrepreneurs? 41.2% – Ranking – 80th out of 185, Strong – Trend ¯
Source: Doing Business 2013 – Paying Taxes & Registering Property, World Bank
SQ 28 What is the tax on profits for foreign investors when divesting property? Strong – 20% Corporate Income tax, there are also tax incentive for some investments. Source: Doing Business 2013 – Paying Taxes & Registering Property, World Bank http://www.doingbusiness.org/data/exploreeconomies/turkey#paying-taxes
Core Question: Are the professional services necessary for efficient and transparent property markets available and appropriately regulated and supervised? No – Weak, as the system focuses on commercial property under the Capital Markets Board, the residential system is largely unregulated.
SQ 29 Are property valuers licensed and/or certified by the government? Yes, Strong by the Capital Markets Board.
Source: C: Capital Markets Board http://www.cmb.gov.tr/
Q 30 How effective are mechanisms in place to discipline valuers who engage in misconduct? Unknown.
Civil Society Resource: International Real Property Foundation www.irpf.org \
Brokers & Agents
SQ 31 Are real estate brokers and agents licensed and/or certified by the government? No – Weak
SQ 32 How effective are mechanisms in place to discipline brokers or agents who engage in misconduct? None on Place – Very Weak.
SQ 33 Are mortgage professionals licensed and/or certified by the government? No – Weak, the mortgage market is still very small.
SQ 34 How effective are mechanisms in place to discipline mortgage professionals who engage in misconduct? Unknown.
Core Question: Are capital markets well-regulated and diversified enough to provide financial resources to private-sector entrepreneurs and innovators? Yes, Strong, Turkey’s financial sector is competitive.
6.3.1 How restricted is the flow of capital into and out of the country? Strong – Ranking 54th out of 144; Score 4.8 out of 7
6.3.2 Is the regulation of securities exchanges transparent, effective and free of influence from government and industry? Yes – Very Strong, Ranking 25th out of 144; Score 5.2 out of 7
Source: The Global Competitiveness Report 2012-2013, World Economic Forum
6.3.3 What is the depth of asset-backed securities, mortgage-backed securities, high-yield bonds and highly leveraged loans? Very Weak – 45th out of 62, Score 1.70 out of 7, capital markets are very small with low turnover.
Source: Financial Development Report 2012, World Economic Forum http://www.weforum.org/reports/financial-development-report-2012
FQ 21. What is the overall taxation system in regards to property?
Real estate transactions are taxed. However, based on the structure of the deal, certain amount of the tax can be dodged. For example, in residential home sales, deeds can be transferred before the completion of a house, and a sale of a home would technically never have taken place. Taxes for owned properties are very low in Turkey. In Bodrum, the real estate tax for several acres of land is around $50 USD.
FQ 22. What is the number of practitioners in the country including full-time brokers/agents with formal training and part-time, informal brokers?
FQ 23. What is the number and average size of brokerage companies?
FQ 24. Are there brokers associations active in the market? What number and what percentage of practitioners belong?
FQ 25. What training programs are available to enhance productivity?
FQ 26. Is there a Code of Ethics or standards that practitioners follow? Is the Code enforced?
FQ 27. Do civil society organizations exist to support the development of mortgage professionals?