The question “What should you pay attention to when buying a house?” is one of the most important ones that arises before acquiring property. Even a small mistake during a real estate transaction can pose serious risks for both the buyer and the seller.
Being informed about what to consider when purchasing property is crucial to making a sound investment. One of the biggest mistakes in this process is starting without doing the necessary research. To help you proceed in the best possible way, as Antalya Development, we will share with you 5 basic issues you should pay attention to when buying a house.
1. Check the Title Deed and Legal Documents
Your first step should be to thoroughly examine the legal status of the property. Issues with title deeds or legal documents can lead to serious financial losses and long legal disputes in the future.
Is there a lien or foreclosure in the land registry?
Ensure that the property can legally be sold. The first step to this is to examine the land registry in detail. Here are some important documents and checks you should pay attention to:
- Title Type: The property may be registered as “land”, “floor easement” or “condominium”. The most secure is the condominium, because this means that the structure is completely completed and has received occupancy. The occupancy certificate, also known as the building usage certificate or residence permit certificate, is an official document confirming that the project is built in accordance with the construction permit and the approved architectural project. In houses without occupancy certificate, there may be problems with subscriptions such as electricity and water. The floor easement indicates that the construction has started but has not been completed.
- Mortgage, Seizure, Annotation: Is there any mortgage, lien, lease annotation or other third party right on the property in the land registry? Be sure to check whether any third parties have legal claims on the property. This is one of the most common pitfalls for foreign buyers. Mortgage means securing receivables with collateral. Especially in houses purchased by taking out a loan from a bank, there is a mortgage in favor of the bank and if the debt is not paid, the bank has the right to sell the property. Seizure is a process that begins as a result of non-payment of debts to individuals, institutions or banks. Buying a seized house carries great risk because the sale of seized property can only be realized through an auction organized by the enforcement office.
- Land Registry Office Inquiry: You can learn the current status of the property via e-Government or by going to the Land Registry Office in person. You can easily access this information thanks to the TAKBIS system, where property data in Land Registry and Cadastre records are transferred to the electronic environment throughout Turkey.
2. Investigate Earthquake Risk and Structural Safety
Turkey is located in one of the most active earthquake zones in the world. The earthquakes centered in Kahramanmaraş that occurred on February 6, 2023 and affected 11 provinces reminded us once again that attention should be paid to building inspection, ground selection and construction quality. The fact that the vast majority of the buildings that remained standing are in compliance with the new regulations has proven once again that properly constructed buildings save lives. Therefore, when buying a house, not only price and location, but also building safety and inspection history should definitely be questioned.
Request a ground survey report
A ground survey is a technical report prepared as a result of a detailed examination of the land where a structure will be built. Why is a ground survey report so important? Because this report foresees the effects of the loads that occur during an earthquake and guides the construction of the building from materials and sections that can carry these loads. You can access ground survey reports from municipalities or building inspection companies. Also request an earthquake resistance report for the structure.
Check the building inspection documents
Building inspection documents are official documents that show that every stage of the building’s construction process has been checked by professional inspectors. Buildings built after 2001 must be inspected by a building inspection company. The risk is higher in buildings built before this date. Examine the building’s building permit and inspection documents.
Is there a certificate of compliance with the Earthquake Regulation?
In order to check the building’s compliance with the earthquake regulation, the dates on the building’s building permit and building occupancy permit are important. You can understand which period is subject to the earthquake regulation according to the dates in these documents. You can also get information about the building’s compliance with the earthquake regulations from the municipality or institutions affiliated with the Ministry of Environment, Urbanization and Climate Change. The 2018 Earthquake Regulation is the most up-to-date and strict regulation in Turkey.
3. Evaluate the Seller or Contractor’s Reliability
When buying a house, not only the physical condition of the building but also the history and reliability of the person or contractor selling the house to you are of great importance. Past projects provide valuable information about the contractor’s work quality, knowledge, reliability and ability to complete projects on time.
When researching the contractor’s previous projects, pay attention to the following points:
- Construction Quality: Check the overall quality of completed projects, materials used and workmanship.
- Delivery times: Check whether the projects were completed within the promised timeframes.
- Customer satisfaction: Talk to people who have previously purchased a house from that company and learn about their experiences.
The company’s financial status and references
Another important point to consider when choosing a contractor company is the company’s financial status and references. Companies experiencing economic difficulties may have difficulty completing their projects on time, and this may cause grievances for buyers. What projects have they done before, have there been any problems in the delivery processes? Even a small research on the internet about the company can provide many clues.
Financial analysis is an important tool when evaluating the company’s financial status. Here are some ratios to consider in financial analysis:
- Financial leverage ratio: When this ratio is lower than 0.5 and 0.6, there is an advantage for the company.
- Financing ratio: If this ratio is above 1, it indicates that the company is healthy.
- Equity ratio: The ideal expected ratio should be above 0.5.
On the other hand, make sure that the contractor has a Contractor Authorization Certificate issued by the Ministry of Environment, Urbanization and Climate Change to check its competence.
Does the contract include a delivery date and penalty terms?
After finding a reliable contractor, it is time to prepare a detailed contract. The contract is the most important legal document that determines the rights and responsibilities of the parties. The main issues that should be included in construction contracts in return for flats are the clear writing of the periods foreseen for the delivery of the site, obtaining the construction permit, completing the construction and obtaining the occupancy permit after the actual delivery. Leaving these periods vague may encourage the contractor to be flexible and extend the process.
The following details must definitely be included in the contract:
- The transfer of the share to which the contractor will be entitled and how these transfers will be made
- Removal of mortgages
- Approval of the project based on the construction permit
- Completion rates for the return of letters of guarantee
- Completion of the work without defects and without any defects
- Prohibition on transfer
- Penalty conditions to be applied in case of delay in the delivery period
4. Clarify Payment Methods and Costs
When buying a house, discussing financial issues transparently prevents possible disputes that may occur later. Clarifying payment methods and expenses from the beginning is vital for a safe purchase-sale process as well as budget planning.
Who will pay the title deed fee?
The title deed fee is a mandatory fee to be paid in real estate purchases and sales. This fee is calculated based on the sales price of the real estate sold and corresponds to 4% of the total sales price. According to the law, this fee must be shared equally by the buyer and seller, meaning that both parties must pay 2%.
However, in practice, this is not always the case. Most of the time, the parties can agree among themselves to pay the entire title deed fee by a single party, and this does not pose any legal problems. If the title deed fee is not paid, the title deed transfer procedures are stopped and a sale without a title deed is considered legally invalid.
How will the deposit and payment plan be?
A deposit is a sum of money given by the buyer to the seller to show that they have agreed to purchase a certain real estate and provides security for the contract. There is no definite rule regarding the amount of the deposit, but it is usually determined as between 5% and 10% of the sales price. This amount may vary depending on market conditions, the value of the real estate and the agreement between the parties.
The following details should be clearly stated in the contract:
- Deposit amount
- Payment terms (how and when to pay)
- Deposit return terms
- Deposit usage terms
Blocked check or title deed exchange system
Using secure payment methods in real estate transactions is extremely important, especially for high amounts. The two most commonly used methods for this are the blocked check and the title deed exchange system.
What is a blocked check and how is it used?
A blocked check is a secure payment method used to eliminate the risk of carrying cash in real estate transactions. This type of check is especially preferred in high-value housing, land and workplace sales.
The biggest advantage of using a blocked check is that it eliminates the buyer’s distrust of the seller. Because the check is guaranteed by the bank and there is no risk of it bouncing.
Title deed exchange method
The title deed clearing system is a system developed within the framework of the protocol signed between Takasbank and the General Directorate of Land Registry and Cadastre.
The operation of the title deed clearing system is as follows:
- The buyer and seller apply to the Land Registry Directorate and receive an e-payment (receipt) number for the fee amount.
- This receipt number is entered into the system from the title deed clearing address or via the “Tapu Takas” mobile application.
- Title deed information is checked and approved via the TAKBİS system.
- The buyer and seller enter the IBAN information and the sales amount into the system.
- The sales price sent by the buyer is kept in the blocked account at Takasbank.
- After the transaction is completed at the Land Registry Directorate, the amount in the blocked account is automatically transferred to the seller’s account in line with the information received from TAKBİS.
Another point to consider when evaluating all expenses is taxation. You can review our article titled Home Purchase Taxes in Turkey regarding taxation.
5. Research the Location and Investment Potential
A home should not only meet your current needs but also maintain its value in the future. Therefore, it is important to carefully examine factors such as the location, environmental development and infrastructure investments of the home you are considering purchasing.
Location is everything
The social structure, security, transportation facilities and living areas such as schools, hospitals and parks in the neighborhood where the property is located have a direct impact on the price. Even in non-central areas, if there are new transportation projects, shopping malls or university investments, the potential for appreciation is high. For example, if you want to buy a property in Antalya, you need to evaluate the area where the property is located, its proximity to the sea and transportation areas, and future projects for the developing city.
When purchasing real estate, we are also purchasing a living space. It is very important to pay attention to these critical points in order to get through the upcoming processes more healthily and safely. When the right time comes for both you and the house you want to buy, carrying out this process meticulously and consciously will be the strongest guarantee of your future peace.
