Turkey home sales rise for second month as mortgage costs slashed

Sales of housing in Turkey rose by an annual 15.4 percent in September as a reduction in interest rates sparked a surge in mortgage borrowing.

Sales increased to 146,903 units, the Turkish Statistical Institute said on its website on Wednesday.

Purchases financed via mortgages jumped by 410 percent to 57,811 units, equivalent to 39 percent of total purchases. Sales of homes via other means fell by 23 percent to 89,092 units.

Turkey’s government has instructed state-run banks to slash rates on home loans to reinvigorate a sector pummeled by a currency crisis last year. The reductions in interest rates have been supported by the central bank, which has slashed borrowing costs. Property developers are also slashing prices to get rid of old housing stock

Sales of new homes decreased by 15 percent to 51,393 units, while second-hand house sales increased by 42 percent to 95,510 units, the institute said. Many new properties have been seized by Turkey’s banks for unpaid debts, or ownership has been transferred for other reasons.

House sales to foreigners fell by an annual 26 percent to 4,177 units.