Turkish house sales dip in July, but analysts hopeful for future

ISTANBUL

House sales in Turkey plunged by 20.2 percent in July, though many analysts have put the dip down to the effect of Ramadan and expect upward momentum through the rest of the year.

According to figures released by the Turkish Statistical Institute (TÜİK), a total of 85,101 houses changed hands in July, marking a one-fifth decline from the same month last year.

The number of sales for the first seven months of the year was 609,877, TÜİK data also showed.
Higher interest rates, political stability concerns, and high base effect have been keeping Turks from buying new residences since the beginning of the year.

However, the figures announced yesterday revealed the decline peaked in July after contracting 3.6 percent annually in June.

The number of houses purchased with mortgage loans dived even further at 32.9 percent over the course of June.

However, analysts and sector representatives expect sales to pick up in August.

“House sales witnessed a steep decline with the impact of Ramadan, summer season slackness and uncertainty caused by the presidential elections,” said Industrial Development Bank of Turkey (TSKB) Real Estate Valuation General Directorate Makbule Yönel Maya, adding that the halt of operations through the five-day Eid-al Fitr holiday also had an effect.

“However, we see that sales are increasing in August, after Ramadan. Sales are expected to liven up following the end of the elections, the removal of political uncertainty and the end of the summer holiday,” Maya said.

After a massive hike in January, the Central Bank has shaved its benchmark interest rate by 1.75 points over the past three months, also easing mortgage terms for consumers.