How Turkey’s New Laws Could Cut Post‑Quake Property Prices by Up to 74%

Parliament returns with sweeping proposals that matter to property buyers and investors

Turkey’s parliament reconvenes this week with a heavy agenda that will matter to anyone tracking property in Turkey. Lawmakers will debate a package of measures ranging from reconstruction incentives for properties built after the 2023 earthquakes to a new tax on crypto transactions. We examine what is proposed, who wins and who risks losing, and what buyers, investors and expats should do next.

Why this week matters for the property market

The bills under discussion combine fiscal measures and sector-specific reforms. For the real estate sector the headline is an offer aimed at speeding home purchases and commercial reoccupation in southern Turkey by offering deep discounts for lump-sum buyers. At the same time, broader tax changes — including a 0.03% transaction tax on crypto-asset sales — will affect how purchasers fund deals, and adjustments to corporate tax benefits could reshape developer and institutional landlord economics.

What the draft bills actually propose

Parliament’s agenda covers several areas that intersect with real estate and investment.

• For properties built after the 2023 earthquakes in southern Turkey there is a discount for lump-sum payments made by 31 December 2026.
  • Debtors receive a 74% discount on their first home.
  • Debtors receive a 48% discount on their first place of business.
• A tax on crypto-asset transactions would apply to sales or transfers mediated by crypto-asset service providers at 0.03% of the transaction or fair market value at transfer.
• Corporate tax exemptions for health institutions of privately-run universities are proposed to be scrapped.
• Advertising and promotion expenses for all types of games of chance and betting will no longer be deductible for corporate income tax calculations.
• Real estate owned by universities, special-budget administrations, regulatory agencies, social security institutions and their affiliates could be included in privatization programs on request of the relevant administration.
• Income from the sale of manufactured goods by taxpayers operating in free zones — whether sold abroad, within the free zone or to other free zones — would be exempt from income or corporate tax.
• The fee for paid military service will increase by 25%.

The General Assembly will also review several international agreements and host an address by President Recep Tayyip Erdoğan at his party meeting midweek.

The earthquake‑era discounts: who benefits and why it matters

The biggest immediate impact for the housing market is the proposed lump-sum discount for post-earthquake buildings. Here are the practical implications.

Mechanics and eligibility

• The discounts apply only to properties built after the 2023 earthquakes in southern Turkey.
• They require a lump-sum payment made by 31 December 2026 to qualify.
• The discounts are sizeable: 74% for a first residence and 48% for a first business premise.

Why lawmakers may be offering these discounts

• Encourage rapid reconstruction and reoccupation of affected areas.
• Reduce outstanding debtor obligations tied to reconstruction loans or claims.
• Stimulate local demand and reduce vacancy in newly built blocks.

Who should consider taking advantage

• Homeowners and tenants displaced by the 2023 quakes who can arrange a full cash settlement.
• Small business owners seeking to reopen in rebuilt commercial premises.
• Investors who see a short-term acquisition opportunity and can finance deals without phased payments.

Practical drawbacks and risks

• Lump-sum requirement: many buyers will struggle to raise cash; sellers and developers may not offer financing that preserves the discount benefit.
• Quality and compliance: hastily built units might face structural or compliance issues. Buyers must check building permits, occupancy certificates and independent engineering reports.
• Valuation and resale: a heavily discounted purchase might complicate future valuations and mortgage lending; lenders often assess current market price, not discounted transaction price, for loan-to-value calculations.
• Moral hazard and fairness: the policy may help some debtors but leave others who cannot make lump-sum payments worse off.

Tax changes and incentives that affect investors and developers

The package includes several fiscal measures that change returns for different market participants.

Crypto transaction tax — new friction for crypto‑funded purchases

A proposed 0.03% tax on crypto-asset sales and transfers handled by service providers will bite into low-margin or high-frequency crypto activity. For property transactions financed via crypto exchanges or intermediaries this adds an extra layer of cost and administration. It also signals the government’s move to broaden tax coverage of emerging payment methods.

Investor takeaway:

• If you are considering using crypto to fund a Turkey property purchase, factor in the 0.03% transaction tax plus potential exchange and conversion costs.
• Expect tighter reporting requirements from service providers, which may lengthen closing timelines.

Corporate tax exemptions for private university health institutions may end

Removing corporate tax exemptions for health institutions linked to private universities increases overhead for those operators. Developers with partnerships or lease arrangements with such institutions should revisit cashflow models and lease terms.

No more advertising tax deductions for betting firms

Advertising and promotional expenses for games of chance and betting will no longer be deductible. That reduces after-tax profits for media owners and property landlords who rely on advertising income linked to these companies; impacts are sectoral rather than broad-based.

Free zone export exemptions remain attractive

Income earned by taxpayers in free zones from the sale of manufactured goods would stay exempt from income or corporate tax, whether sold abroad or to other free zones. For industrial property investors and developers focused on export manufacturing facilities, this preserves an existing tax incentive.

Privatization of state and university real estate — opportunities and caveats

One proposal makes it possible for real estate owned by universities, regulatory agencies, social security institutions and others to be included in privatization programs upon request. That opens new acquisition pipelines for investors but raises several points to heed.

• Opportunity: Institutional parcels may become available for conversion to housing, offices, student accommodation or commercial use.
• Due diligence: Public-sector land often carries restrictions — easements, public service covenants, or preservation obligations — and titles can be complex.
• Political risk: Privatization proceeds and timetable are political decisions, and reversals or delays can occur depending on government priorities.

For investors we advise:

• Obtain full title and encumbrance searches early.
• Seek clarity on zoning and permitted uses before bidding.
• Factor potential social or political opposition into deal timelines.

What this means for buyers, ex-pats and foreign investors

We set out the practical checklist and strategies that buyers and overseas investors should consider now.

For owner-occupier buyers in quake zones

• If you are eligible and can manage a lump-sum payment, the 74% discount on a first home is an attractive fiscal incentive — but check structural safety and legal standing of the property.
• Consult registered engineers and request building control documents and occupancy permits.
• Assess financing: a large cash requirement may force a sale of other assets or a restructured mortgage; talk to local banks early.

For small business owners

• A 48% discount on a first business premise reduces entry cost, but locate where customer demand and infrastructure recovery support operations.
• Verify utility connections, road access and local employee availability.

For property investors and developers

• Short-term opportunities: discounted sales and potential privatization disposals provide deal flow.
• Liquidity and exit: discounted buyers who cannot refinance or who buy for short-term flips may create price volatility.
• Funding strategy: cheap acquisition costs may be offset by higher compliance, renovation or recapitalization expenses.

For expats and foreign investors

• Legal residency and property ownership rules: foreign buyers should confirm applicable restrictions and tax residency implications before committing cash.
• Currency exposure: lump-sum payments in a depreciating currency environment carry foreign exchange risk; consider hedging strategies.
• Payment channels: with new crypto transaction tax and evolving reporting norms, using established banking channels may be preferable for clarity and lender acceptance.

Market outlook and fiscal implications

These proposals aim to accelerate reconstruction and broaden tax bases.