Property sales slip as housing loan rates rise

Property sales slip as housing loan rates rise

Property sales slip as housing loan rates rise Real estate sales in Turkey decreased by 1.9 percent in January compared to the same month of the previous year to around 84,500, as mortgaged house sales saw a dramatic drop due to high interest rates in housing loans. 

Mortgaged house sales throughout Turkey were recorded as 26,584, a decrease of around 20 percent compared to the same month of the previous year, according to data from the Turkish Statistics Institute (TÜİK), which was released on Feb. 24. Mortgaged house sales had a 31.4 percent share of all house sales in Turkey.

Noting the key factor in property sales was loan rates, TSKB Real Estate Evaluation General Manager Makbule Yönel Maya added, “There was a sharp decline in the number of mortgaged housing sales as people do not want to buy houses by loans due to higher interest rates.” 

“They therefore buy their house by cash or choose alternative payment methods with their contractors,” said Maya, as quoted by Reuters. 

Maya noted the average rates, which were around 0.9 percent last year, have now increased to 1.25 percent in property loans. 

Istanbul had the highest share with 18.4 percent of property sales with around 15,500 units, the TÜİK data showed, followed by the capital Ankara with 9,012 units and the Aegean city of İzmir with 5,243 units. The least properties were sold in the southeastern province of Şırnak, with just six units. 

A total of 142,599 properties were sold in December 2015 and the total figure last year was around 1.3 million. 

Sales to foreigners on the rise

In January, a total of 1,462 properties were sold to foreigners, a 13.4 percent increase from the same period of the previous year, according to the TÜİK data. Citizens from Iraq bought the largest number of houses in Turkey in January with 308 units, followed by Saudi Arabia with 136 units, Kuwait with 134 units, Russia with 106 units and Afghanistan with 104 units. Istanbul was the top province among foreigners with 498 sales, followed by the Mediterranean resort of Antalya with 315 units and the northwestern provinces of Bursa and Yalova with 129 units and 84 units, respectively.