After the 250 basis point interest rate cut implemented by the Central Bank in recent weeks, Turkey’s real estate sector is gearing up for a promising period in 2025. Derya Filiz Dalga, Chairperson of Mega Project Management Board, noted that the housing market began to pick up momentum in the last quarter of 2024 and is expected to gain further traction in 2025. Dalga emphasized that the drop in interest rates would make housing loans more accessible in the second half of the year, but buyers looking to seize opportunities before prices rise would be in a favorable position.

Recovery in the Last Quarter of 2024

After a period of stagnation in recent years, the real estate sector started to regain activity in the last quarter of 2024. Dalga stated that while there was an increase in sales volume, a decline was observed in mortgage sales and credit utilization. Although the growth in metropolitan areas and the dynamism in primary sales indicate the market’s resilience, key challenges such as high interest rates and a decline in sales to foreigners persist. These challenges underline the need for new strategies.

Contractors’ Installment Payment Models Revitalize the Market

Dalga highlighted that installment payment models developed by contractors have become a key factor in revitalizing the new housing market. She noted that during this period of high interest rates, buyers face challenges in paying down payments, and these installment methods are expected to boost market activity.

Credit-Based Sales to Increase in the Second Half of 2025

Derya Filiz Dalga stated that the interest rate cuts would impact housing loans in the second half of 2025, leading to an increase in credit-based sales, while prices are expected to remain stable during the first half. As sellers shift towards credit-based transactions rather than cash sales, market activity is anticipated to rise in the latter half of the year.

A Window of Opportunity Has Opened

Dalga observed that although interest rate cuts have not yet made loans more accessible, savings traditionally kept as cash are starting to flow into safe investments like real estate. She remarked that many individuals facing cash shortages would turn to selling properties. “This is the perfect time to buy for those with funds,” she said, emphasizing that buyers who act before prices rise and interest rates drop will reap significant benefits. Dalga believes that those who capitalize on this opportunity will gain an advantage in the future.

Savings to Shift Toward Real Estate

Dalga pointed out that with deposit interest rates decreasing, savings previously kept in cash and funds leaving exchange rate-protected deposit accounts are expected to flow into real estate. Investors, unable to generate sufficient income from deposit interest rates, will likely start opting for alternative investments like real estate.

2025: A Promising Period for the Real Estate Sector

Macroeconomic indicators, political developments, and technological transformations will be among the key factors directly affecting the real estate sector in 2025. Dalga emphasized the importance of investors carefully analyzing these elements. She noted that monitoring economic indicators such as exchange rates, interest rates, and amortization periods will be critical when making investment decisions.

Prices Will Not Drop Without Declines in Land and Construction Costs

Dalga highlighted a shortage in supply within the sector, with many firms exiting the market. She stated that prices could only decrease if there were an oversupply and a drop in demand. “However, there is no production happening, so I do not expect prices to drop. Without a reduction in land costs, it is unlikely for housing prices to decrease,” she said. Dalga added that while firms could previously lower prices using existing materials, rising costs have made price increases inevitable.

Location and Future Value Will Be Key

Dalga emphasized that location remains the most critical factor determining the success of real estate investments. While central areas in major cities maintain their value, transportation projects and urban transformation efforts are expected to increase the long-term profit potential of surrounding areas. Investment opportunities in emerging regions are anticipated to grow in 2025.

“Real Estate Investors Can Profit”

In her 2025 outlook, Derya Filiz Dalga said, “2025 will be a promising period for the real estate sector. With interest rate cuts and the economic recovery process, those making the right investments are expected to benefit. I emphasize the significant opportunities that will be available to homebuyers. According to our projections, we will see real price increases in housing following a recovery in demand after the first quarter of the year. Real estate investors who act at the right time can seize major opportunities.”