Real Decline in Housing Prices Reached 9 Months: Experts’ 2025 Predictions
According to the data of the Central Bank of the Republic of Turkey (CBRT), the real decline trend in housing prices has reached its 9th month. In October, the Housing Price Index (HPI) increased by 2.1 percent to 151.1. However, despite the nominal increase of 26.8 percent on an annual basis, there was a 14.7 percent decrease in real terms due to inflation. Experts state that this trend could continue until the first quarter of 2025.
Real Decline Continues in the Housing Market
The fact that housing prices continue to fall in real terms is considered a remarkable development in a period of high inflation. Experts predict that this trend in housing prices could continue in the medium term if real interest rates remain at current levels.
Real estate economist Ahmet Büyükduman stated that prices may follow a course parallel to inflation in the upcoming period, and said, “This situation may create an advantageous process, especially for buyers.”
2025 First Quarter Forecasts
Istanbul Chamber of Commerce (ITO) Real Estate Services Professional Committee Chairman Hakan Akdoğan stated that the real decline may continue until the first quarter of 2025. Akdoğan said, “We think that the pending demand will be activated with the decrease in deposit interest rates and easier access to housing loans.” It was emphasized that a possible decrease in housing loan interest rates in particular could change the balances in the market.
Expectation of Increase in Demand
Real Estate Marketing and Sales Professionals Association (GAPAS) Chairman İsmail Özcan argued that housing demand will increase if the expected interest rate cuts of the TCMB are reflected in loan interest rates. Özcan stated that many people who avoid high rents have started to prefer loan installments, and that this situation keeps demand alive.
Özcan also drew attention to the fact that the decrease in housing stocks increased the pressure on the market and stated that this recovery in demand could increase prices again. “The decrease in existing stocks may create an upward trend in prices again,” he said.
The Effect of Interest Rate Cuts
With the interest rate cuts expected in early 2024, activity is expected in the housing market. Experts believe that easier access to housing loans may cause falling prices to rise again. However, it is stated that the course of inflation and the general economic situation will have a decisive effect on the change in the market during this process.
Market Dynamics and Future Expectations
While the real downward trend in housing prices offers opportunities for buyers, it also affects the general dynamics of the market. As access to loans becomes easier, demand is expected to increase and prices to rise again. Experts state that this situation should be managed carefully in order to create a balanced market.
As a result, the real decrease in housing prices offers a period of opportunity for buyers. However, changes in interest rates and the decrease in housing stocks may affect the balances in the market. The first quarter of 2025 will be a critical period for the future of this trend.
