Endeksa Assesses the Situation in Residential Sales with Credit: What awaits the Market in 2024

Using big data analytics and artificial intelligence methods to provide real estate valuation, which enables users to confidently sell their properties, Endeksa scrutinized the housing market's sales over the past year. With the anticipated new interest rate regulations expected to facilitate financial access, an increase in housing sales volumes is anticipated. According to Endeksa's data, as of December 2023, the average housing sale price in Turkey increased by 4% compared to the previous month and by 11% over the last three months, reaching 3,092,700 TL. Additionally, the 84% rise in housing prices throughout 2023 has significantly restricted access for prospective homeowners.

A decrease of over 36% in mortgage-based sales

In 2023, a total of 1,225,926 houses were sold in Turkey. The figures indicate a decrease of 259,696 units in home sales compared to 2022. The drop in home sales from the previous year was 17.5%. In 2022, the total number of home sales was 1,485,622 units.

The most notable decline in 2023 compared to the previous year was observed in mortgage-based home sales. Across the country, 177,748 mortgage-based home sales were recorded in 2023. In 2022, there were 280,320 mortgage-based sales, indicating a 37% decrease in such sales over the year. In 2023, mortgage-based home sales accounted for 14% of total sales, down from 19% in the same period of 2022.

The rate of increase in housing prices remains below last year

When comparing 2022 and 2023, December 2022 was the month with the highest number of home sales, totaling 207,963 units. According to Endeksa data, the average home sale price in Turkey during this period was 1,664,100 TL. January 2023 was a slow month with only 97,708 sales, and the average home sale price increased by 9% compared to the previous month, reaching 1,816,360 TL. By the end of 2023, in December, the total number of home sales was 138,577, with the average home sale price at 3,092,700 TL.

Looking at the share of mortgage-based home sales in total home sales, this ratio has been declining since April 2023. In June 2022, when the average home sale price was 1,215,110 TL, the share of mortgage-based home sales peaked at 27%. However, by September 2022, mortgage-based sales had dropped to 15%, and the fluctuating trend continued up to the present. By December 2023, mortgage-based home sales fell to 6,042 units, representing 4% of total home sales, the lowest percentage in the past two years.

Endeksa Co-Founder and General Manager Görkem Öğüt highlighted the influence of interest rates and credit policies on the current state of the mortgage market, stating:

"Fluctuations in the share of mortgage-based home sales are due to conditions such as high prices, rising credit costs, and difficulties in accessing credit. We see that mortgage-based home sales have decreased by 70% between December 2022 and December 2023, that is, over the course of one year.

Currently, actors in the mortgage market, both buyers and sellers, are acting cautiously. This is because a campaign expected to be implemented soon will particularly support first-time home purchases. This campaign is anticipated to enable the use of credit with an interest rate of 1.2% over 15 years. Naturally, people do not want to make decisions before seeing the new trends that will emerge in the market after the campaign is launched. We are currently in a 'waiting period.' Once this period is over, we expect both the mortgage market to revive and the number of home sales to increase."