According to the data of the Turkish Statistical Institute (TUIK), house sales in April decreased by 35.6 percent compared to the same month of the previous year and became 85 thousand 652. Housing sales to foreigners decreased by 60.3 percent compared to the same month of the previous year and amounted to 2 thousand 557.
All Entrepreneurial Real Estate Agents Association (TÜGEM) Vice President and civil engineer Dr. Mustafa Koçak made evaluations about housing sales.
Pointing out that the pressure on house sales continues, Koçak said, "There has been a serious decrease in house sales in the last period. Based on April data, there was a 35 percent decrease in residences compared to April of the previous year. Recently, there has been a serious increase in housing prices in the last 1.5-2 years. Purchasing power fell, loan interest rates began to rise and people began to be unable to buy housing. Low-rate loans are given in state banks, but when you go to the bank, you can only use loans with a very low limit, such as 250-300 thousand liras. This requires serious cash. Since people do not have that much cash, they are not able to buy. We can say that buying a house is no longer a dream, it has become a bit of a dream. Because as of today, banks have completely closed both loans and credit taps. I even read in the news. There are scenarios where even approved loans are turned down. This will bring a serious stagnation."
“SALES ARE FURTHER DECREASE IN MAY”
Kocak continued as follows:
"There are many factors in the decline in home sales. Once the prices went up. Prices rose a lot due to inflation. However, there is a contraction in stocks. When we look at the last year's data, there is a decrease in the number of building permit applications. This shows that new construction is decreasing. Of course, construction costs also have an effect on the decrease in new construction. Of course, when the stock is low, there is a demand for a new structure, when new stocks do not arrive, there is a need, and this inevitably moves the housing prices upwards. And as you know, there was an earthquake in February. With the effect of the earthquake, there was a movement from the old buildings, but what did they do when the people living in the old building could not buy a house from the new building and did not meet those costs? They started to move towards renting. This has seriously increased the already increasing rents. In the middle of March, it was announced that the election would be on May 14. This, of course, brought a stagnation in April. In May, I predict a further decrease in sales."
“IF THE ENVIRONMENT OF CONFIDENCE IS NOT ESTABLISHED, THE MARKET WILL REACH ON IMPASSE”
Koçak stated that in the upcoming period, if an environment of trust is not established after the election, the market will become even more deadlock.
"There is a rule in economics. If demand falls, the price falls. At the moment, the demand is seriously down, but the price is not going down. It won't fall. Because this rule in economics is valid when all the conditions we call 'Ceteris Paribus' are stagnant, while all the conditions are constant, but none of the conditions are fixed. There are too many variables, too many influencing situations. Therefore, even if the demand decreases, I expect the prices to decrease only relatively, that is, in the rate of price increase. However, the decrease in prices will not occur in the coming period. How far will this go? We'll see ahead. People cannot buy housing, but they are renting. With the increase in rental prices, there are problems between the landlord and the tenant. They do not stay on the lease. They also have to buy. But at such a moment there is a stalemate. We will see what will happen in this upcoming period," Koçak added.