Home sales in Turkey are affected by high prices and interest rates

Istanbul, December 04

Recent developments in the Turkish real estate market are of concern to both local residents and potential investors. High house prices and rising interest rates have a significant impact on the market, affecting sales and buyer behavior.

Turkey is facing challenges in the real estate market

In the first 10 months of 2023, home sales in Turkey fell by more than 14%, reaching 994,000 units. Experts point out that this is due to several factors, including exorbitantly high housing prices and rising interest rates. While expectations were at 1.2 million units sold by the end of 2023, the downward trend raises serious questions about the future of the market.

House prices in Turkey at record highs

The average house price in Turkey increased by 103% in October 2023 compared to last year, exceeding the mark of 3 million Turkish lira (about $105,000). This creates a challenge not only for local buyers, but also for tourists considering Turkey as a potential place to invest in real estate.

Interest rates and access to loans

High interest rates and limited access to loans are becoming a significant barrier for potential buyers. Experts also point to more attractive deposit account rates that divert interest from residential real estate investments.

Market reaction and expert opinions

Gokhan Tash from the MasterTürk Group noticed that there is a 60% decrease in mortgage sales, which significantly affects the total sales volume. According to him, people no longer consider houses as an investment, but buy them only if they really need to. This confirms the general downward trend in housing demand under current market conditions.

Prospects for the future

While the current situation raises concerns, experts note that the real estate market in Turkey is still dynamic. Changes in the market structure, an increase in office occupancy and interest in land plots indicate possible shifts in customer preferences.