Increase in property taxes burns a hole in citizens' pockets: Title deed transactions locked

As of the new year, there has been a major increase in property taxes. The significant amounts recorded in the increases of land and building fair market values have directly affected property taxes. Especially in metropolitan cities like Istanbul, property taxes, which vary by district, have shocked citizens.

LIMIT IMPOSED ON FAIR MARKET VALUE INCREASE

As of the new year, with the upper limit imposed on land and building fair market values, property taxes in metropolitan cities like Istanbul have tripled. According to the regulation, the increase in fair market value for plots and land has been limited to a maximum of three times. However, the increases made were high enough to strain the pockets of many property owners.

PROPERTY TAXES FACED WITH RISING RATES

A property owner who paid 3,300 TL in property tax in Istanbul in 2023 had to pay three times that amount, or 9,900 TL, in property tax this year. Real Estate Expert Mustafa Hakan Özelmacıklı shared the information that these increases were "increased three times compared to the previous year."

99,237 TL PROPERTY TAX PAID IN KÜÇÜKÇEKMECE

High tax payments are particularly striking for land owners. In Küçükçekmece, a person who owns two different plots of land that are not zoned for construction paid 33,058 TL in property tax last year, while this year that figure rose to exactly 99,237 TL. Similarly, payments for apartment owners in Üsküdar have almost tripled. A person who paid 3,352 TL last year had to pay 9,539 TL in property tax this year.

LAND OWNERS PAY HIGHER TAXES

This year, the highest tax burden is concentrated on land. Land owners pay three times higher taxes compared to residential property owners. This situation creates a major cost for owners of zoned land. It is stated that property tax increases will strain citizens who own land where no construction has taken place even more.

TITLE DEED TRANSACTIONS ARE LOCKED

Furthermore, it has been reported that title deed transactions have also stalled due to the increased property tax value. Because the fair market values at the municipality are too high, many sales transactions cannot be completed in the calculation of title deed fees. Title deed transactions are being turned away by property owners due to these high taxes. Additionally, these increases in property taxes also raise the capital gains tax, which hinders sales.

To resolve this situation, the government is expected to make a regulation regarding a value reconciliation. In this context, a one-time declaration amnesty or value reconciliation could be provided to pave the way for title deed transactions.

RETIREES AND RELATIVES OF MARTYRS ARE EXEMPT

On the other hand, there are exemptions for certain segments regarding property tax. While the exemption continues for retirees who own a single residence not exceeding 200 square meters, relatives of martyrs and veterans, as well as those receiving widow and orphan pensions, are also exempt from property tax.

Property tax will begin to be noticed this May. Tax payments will be made in two installments in May and November. Property owners who face tax increases this year will have to pay many times more than the property tax they paid previously.

News Source: 12punto