When an investor decides to purchase a property from a project, it is necessary to establish a contractual relationship with the construction company. This situation will serve as a means of determination in resolving any legal issues that may arise with the construction company in the future. Furthermore, according to Turkish laws, contracts for the sale of real estate must be made in accordance with certain procedural rules. Agreements made without adhering to these specified procedures are deemed invalid.
The essential elements such as the conditions of purchase, delivery dates, payment terms, etc., of the property under construction are documented in these contracts, providing ease of proof. Contracts for the sale of real estate in the construction phase must be made in the presence of a notary as “Real Estate Sales Promise” contracts or formally at the Land Registry Directorate. However, in practice, many construction companies and consumers avoid this route to avoid paying notary and land registry fees, opting instead to sign contracts among themselves. Contracts made in the presence of a notary as “Real Estate Sales Promise” contracts can be registered in the archives of the land registry office of the property subject to sale. This prevents the property from being sold and transferred to third parties, thus mitigating the risk of loss.
In these contracts, it is advisable to include and clearly specify the sales amount, payment plan, start date of construction, delivery date, compensation in case of delay, and other related matters. If a contract is signed between a construction company and a consumer without adhering to the form specified by law, even if the property is still in the construction phase, the consumer should request a Condominium Ownership (Kat İrtifakı) title deed from the construction company. Otherwise, a risky sales contract would have been signed.
When contracting with construction companies, it is essential to verify whether the person signing the contract on behalf of the company is the official and authorized representative of the company. Legally, a contract signed by individuals who do not have the authority to sign on behalf of legal entities does not bind the respective companies.
Similarly, when contracting with construction companies, it is crucial to determine the ownership of the land on which the project will be constructed. In practice, construction companies in Turkey often undertake construction projects on land that they do not own, reaching agreements with landowners under certain conditions. Therefore, it is necessary to ascertain the ownership of the land where the project is being constructed and, if it does not belong to the company, request a construction agreement with landowners for consideration.
Each case has its unique circumstances and conditions, and therefore, it is necessary to evaluate each case and its consequences separately.
