Interest rates will be decisive for demand

“The goal is to overcome the crisis before it escalates”

arsaVev Chairman of the Board Bülent Öztürk said, “Financing options such as lower interest rate loans specifically for first-time homebuyers, increasing credit upper limits, and extending maturity periods stem from solution-oriented approaches. The goal is to make purchasing possible again for the segment whose access to housing has become difficult under current economic conditions. It is intended to overcome the housing crisis—which we always mention as being a result of both the difficulty of access to housing and the supply shortage—before it grows.”

“Both housing prices and interest rates are high”

Noting that prices are high, Öztürk evaluated, “In their current state, neither housing prices nor mortgage interest rates are at levels accessible to citizens. Some conveniences and advantages were offered recently. Now, more adoptable and applicable solutions are being sought to remove the barriers to housing access. In this regard, for example, special additional interest rate reductions, first-year installment deferrals, more flexible payment plans, or temporary reductions in costs such as title deed fees could be provided. Such supports could attract more attention.”

“Interest rates will be decisive for demand”

Stating that demand will increase if interest rates are kept low, Öztürk said, “The extent to which interest rates are reduced will be decisive here. If there is a significant difference, we can expect demand to increase. An increase in demand stimulates sales in the short term, but since housing supply is insufficient, upward pressure is created on prices, and ultimately, demand begins to decrease again. For this reason, financing facilities must be carried out together with policies that encourage new housing production. The way for the sector to remain vibrant is possible through sustainable, integrated progress.”

“Activity will occur in the market, housing prices will increase”

Regarding those who would push their payment capabilities, Öztürk stated, “For a segment with certain savings, these conditions will still create demand and generate activity in the market. However, as long as there is insufficient housing supply, this activity will not be permanent; price increases will be encountered in a short time and demand will withdraw again. Ultimately, a short-term increase in demand may turn into price increases rather than sales. Therefore, the critical issue at this point is that the housing supply must also increase in the same way. On the other hand, although housing prices decreased in terms of real returns in the previous year, they will ultimately still be found high by many investors. Various factors affecting purchasing power, other than access to credit, also play a role in this. Therefore, despite the conveniences and advantages provided, the problem of access to housing will still not be resolved for a significant portion of citizens. My solution proposal here is that the first step should be taken by acquiring land, which is the largest cost item in housing production, through a correct investment.”