Home prices down 12 percent in real terms in November

ANKARA

Home prices in Türkiye declined by 12 percent in real terms in November compared to the same month of last year, data from the Central Bank showed on Dec. 17.

The residential property price index (RPPI) advanced 2.8 percent monthly and recorded an annual increase of 29.4 percent in nominal terms in November, said the bank.

For Istanbul, the RPPI rose 26.2 percent in nominal terms, while the increases for Ankara and İzmir were 34.8 percent and 26.7 percent, respectively.

The construction sector, which has been in a downward trend for the last few years but showed signs of recovery in the last quarter, is expected to pick up again in 2025, according to industry representatives.

The contraction in the sector, which started six years ago and continued into the first nine months of 2024, has put a financial strain on many companies, said Şeref Demir, president of İMSİAD, which represents construction companies.

Demir linked the revival, which began in the third quarter of 2024, to the unleashing of pent-up demand and changing preferences of deposit holders.

“People took out their money from deposit accounts anticipating that interest rates will decline and started to turn to the real estate market,” Demir said, adding that this revival, however, does not appear to be “enough.”

Some regulations should be made, and steps must be taken to ensure the continuation of this recovery and to put the sector’s growth on a sustainable path, according to Demir.

The high interest rates and construction costs slow down the growth and development of the sector, he explained.

“There is still pent-up demand to be unleashed. We are still very hopeful about 2025.” Demir said.

Urban transformation projects are also expected to boost the construction sector in the coming years, according to Demir.