Türkiye lifts ban on foreign currency sales contracts, exemptions apply
The illustration shows a man holding a key in front of buildings with "For Rent" sign and a Turkish flag. (Collage by Mehmet Akbas/Türkiye Today)
In a landmark regulatory shift published in the Official Gazette on March 6, 2025, Türkiye officially lifted the prohibition on foreign currency sales contracts. This marks a significant departure from the 2018 decree that had previously banned such transactions.
The initial ban was implemented under Decree No. 85 on the Protection of the Value of Turkish Currency, which took effect on September 13, 2018. This regulation strictly prohibited the execution of sales and leasing contracts in foreign currency, particularly in the real estate sector, as part of broader efforts to stabilize the Turkish lira.
However, following the newly published amendment to the Communique on Decree No. 32 (Communique No. 2008-32/34), the ninth paragraph of Article 8 has been revised. The amendment explicitly states that, with the exception of vehicle sales agreements, resident individuals and entities in Türkiye may now enter into movable property sales contracts denominated in foreign currency or indexed to a foreign currency. Additionally, the phrase “determination, payment, and acceptance” in the fifteenth paragraph has been simplified to “determination,” further clarifying the scope of permissible transactions.
This regulatory change will facilitate real estate transactions in foreign currency for both Turkish citizens and foreign nationals residing in Türkiye. As a result, real estate purchases can now be conducted directly in foreign currency, eliminating the need for conversion into Turkish lira.
Uncertainty in citizenship and residency investment rules
Despite this newfound flexibility, ambiguity remains regarding the application of foreign exchange purchase certificates—essential documents required for real estate transactions contributing toward residency and citizenship eligibility.
Specifically, there has been no clarification on how this change will impact the minimum real estate investment thresholds, currently set at $200,000 for residency permits and $400,000 for citizenship applications, nor on how the foreign currency purchase certificate, used in real estate transactions, will be issued for foreign currency sales. Further regulatory guidance on this matter is expected.
Exceptions in lease agreements
While the restriction on foreign currency sales contracts has been lifted, foreign currency leasing agreements remain generally prohibited for residents of Türkiye. However, a key exemption has been introduced: non-resident individuals and entities, including Turkish citizens domiciled abroad, are allowed to engage in lease agreements denominated in foreign currency. This provision is particularly relevant for international investors and foreign companies operating within Türkiye.
The regulation further stipulates that agreements between Turkish residents and their overseas subsidiaries, branches, liaison offices, or entities in which they hold a direct or indirect ownership stake exceeding 50% will still be classified as domestic transactions and remain subject to the existing local currency requirements.
Implications for notarized lease agreements
The new framework allows notarized lease agreements to be executed via authorized proxies, with rental payments now permitted to be determined in foreign currency. However, unlike traditional leasing arrangements, where annual rent adjustments are customary, foreign currency-denominated leases will not be subject to automatic yearly increases. Instead, contract terms will be determined solely by mutual agreement between the parties.
Moreover, while Turkish residents—both citizens and foreign nationals—are barred from leasing properties in foreign currency, they retain the right to request security deposits in foreign currency, offering greater financial flexibility for both landlords and tenants.
As these regulatory changes unfold, market participants and legal experts will closely monitor upcoming clarifications from authorities. Further updates will be shared as they become available.
About the author: Kagan Orhan is a human resources and immigration consultancy expert at “Expat Solutions Turkey”, dedicated to facilitating the adaptation processes of foreigners in Türkiye with the expertise and knowledge in managing legal procedures such as residence permit applications, work permits, business establishment, real estate and citizenship processes for foreigners settling in Türkiye with their team of lawyers and consultants.
