And once again about the real estate laws in Northern Cyprus

Recent amendments have introduced stricter restrictions for foreigners and foreign legal entities purchasing property in Northern Cyprus. According to these amendments, foreigners and foreign legal entities are prohibited from purchasing:

• Agricultural and forest lands;
• Properties located in areas deemed undesirable by the Council of Ministers in the interests of national security, public interest, or public order (except by inheritance). Any registration of a sale contract that contradicts these conditions will be considered invalid;
• More than 7% of the surface area of a district and, in total, more than 3% of the surface area of Northern Cyprus cannot be sold to foreigners.

The Council of Ministers may also restrict certain foreigners or foreign legal entities, including their directors, shareholders, or members, from purchasing or renting properties due to their special status or concerns of national security or public safety. Any registration in the relevant Land Office that contradicts this rule will be deemed invalid.

Requirements for Acquiring Property by Foreigners or Foreign Legal Entities in Northern Cyprus

Foreigners and foreign legal entities are entitled to acquire one property, provided the following conditions are met and permission is obtained from the Council of Ministers:

• Land Plot: The plot must comply with building regulations, should not exceed 1,338 m², and only one residential building may be constructed on it.
• Apartment: Only one apartment may be purchased. A "Kat Irtifak" title deed (pre-registration of floors) or a separate individual title deed is required.
  • Citizens of states that recognize the TRNC as an independent state (e.g., Turkey) may acquire up to three apartments.
• Detached House: The plot must not exceed 3,300 m², and no additional homes or apartments may be built on the land.
• For apartments, foreigners may acquire less than half of the total units in one building, with a restriction of 20% for first-degree relatives or foreigners of the same nationality. At least 20% of the apartments must be sold to TRNC citizens or citizens of states recognizing the TRNC.

Transfer of Ownership

Once the purchase permission is approved, the transfer of the title must occur within six months. Failure to do so will render the permission invalid.

If the purchase price is paid in installments, the six-month period begins after full payment. All applicable taxes, including the transfer fee, VAT (if applicable), and stoppage tax, must be paid within 60 working days after the permission is published in the Official Gazette. Otherwise, the purchase permission becomes invalid.

If permission becomes invalid due to non-payment of taxes, the buyer may reapply, paying double the fee. However, the same buyer cannot make a third attempt to purchase the same property.

Penalties

Failure by either the vendor or the foreign buyer to comply with the rules stated above will result in a fine equivalent to 500 times the minimum wage. This penalty applies to the following situations:

• Selling agricultural or forest land to foreigners;
• Exceeding acquisition limits (e.g., purchasing more than one property or exceeding the allowed surface area);
• Sale without obtaining a separate title deed or a "Kat Irtifak" title deed;
• Selling land with a shared title to foreigners or selling a unit to more than three foreign buyers;
• Selling more than half of the apartment units in a building to first-degree relatives or foreigners of the same nationality;
• Use of trustee agreements to bypass acquisition limits.

Transitional Rules for Existing Contracts of Sale

These rules apply to transactions initiated before the amendments came into effect. All individuals who signed a contract of sale before May 21, 2024, must register it with the Land Office and apply for purchase permission within six months (i.e., by November 21, 2024).

Failure to comply will be deemed an offense and incur a fine equivalent to 500 times the minimum wage. However, if an individual was abroad during this time, that would be considered a valid defense in court.

Foreigners and foreign legal entities who obtained purchase permission before May 21, 2024, must complete the title transfer within six months from that date. Non-compliance, whether by the vendor or buyer, will also result in a fine.

Summary of Deadlines

• Tax Payment for Purchases Approved Before the New Law: 60 working days from August 19, 2024 (deadline: November 11, 2024).
• Registration of Sale Contracts Signed Before May 21, 2024: Deadline is November 21, 2024.
• Application for Purchase Permission for Properties Acquired Before May 21, 2024: Deadline is November 21, 2024.
• Transfer of Ownership for Permissions Approved Before the New Law: Deadline is November 21, 2024.
• Application to the Ministry of Interior Regarding Multiple Properties: Deadline is November 21, 2024 (the tax will increase from 1% to 3% after this date).
• Registration of Trustee Agreements: 75 working days from September 9, 2024 (deadline: December 23, 2024).
• Registration of New Contracts Signed After the New Law: Within 75 working days of signing.
• Permissions Approved After the New Law: Transfers must be completed within six months of approval.
• Permissions Granted Before the Amendments, with a Decision Post-Law: Buyers can obtain separate titles within six months.