Construction sector grows 10.6 percent

Construction sector grows 10.6 percent

ANKARA - Anatolia News Agency
Construction sector grows 10.6 percent

Higher costs in house loans are pushing the demand down, a report says.

Turkey’s construction sector grew by 10.6 percent in the third quarter of last year, reaching a total volume of 15 billion Turkish Liras, according to data of the leading construction association of the country released yesterday.

One of the strongest engines of the country’s economy, the construction sector growth in the second quarter of last year was nearly 13.4 percent, according to the Turkish Constructors Association’s (TCA) report titled “World-Turkey Construction Sector in the shadow of global crisis.”

The heat of the aggressive growth weakened by 2.8 percent in the third quarter compared to the previous quarter, the report said. According to the association, one of the main reasons for the slowdown in growth of the sector stemmed from the construction sector’s need for depleting the housing stock before starting up newly contracted projects in 2012.

Total public investment rose by 9.7 percent in the third quarter compared to the previous one, said the report. Private investments in the sector also jumped by 11.6 percent. According to the report, the number of houses sold in the third quarter slowed down by 5.18 percent compared to the second quarter. However, this still marked 21.57 percent growth compared to the same period of 2010, the report said.

“The slowdown in domestic demand for housing mainly stems from the rising cost of the bank’s credits and the rising concern over the recession in the European economies,” the association said.

Prices of construction materials in Turkey also rose by 5 percent in the third quarter last year, according to the report. The total volume of the construction contracts Turkish firms are running rose to $15 billion in the first nine months of last year. Turkmenistan topped the list with a 17.7 percent share followed by Russia with 17.4 percent, Iraq with 14.6 percent, according to the report.