Turkey's House Price Index Increases by 2.1% in October 2024

The Residential Property Price Index (RPPI) in Turkey continues to show strong growth, registering a 2.1% increase in October compared to the previous month. According to data provided by the Central Bank of the Republic of Turkey (CBRT), the index reached 151.1 using the 2023 baseline. Despite the impressive nominal annual growth of 26.8%, the real value of housing was reduced by 14.7% when adjusted for inflation, highlighting the current state of the real estate market in the country.

However, the growth of the RPPI is not uniform across all regions, with significant differences in major cities. In particular, the index increased by 1.1% in Istanbul, while Ankara and Izmir increased by 2.8% and 4.5%, respectively. In year-on-year terms, nominal growth was 21.2% in Istanbul, 32.5% in Ankara and 28.7% in Izmir, indicating a steady trend in the latter two cities and their attractiveness to property buyers.

Despite high nominal figures, the decline in real house prices contributed to the increase in property sales. According to data from the Turkish Statistical Institute (TurkStat), house sales in Turkey increased by 2.8% in October, and in the first ten months of 2024, this figure increased by 11.9%, reaching 1.11 million units. The increase in first-hand home sales was particularly noticeable: in October, they increased by 97.3%, accounting for 34.9% of all transactions. The growing interest in new properties is also supported by the data that sales during this period increased by 20.4% to 358,558 units, indicating buyers’ desire to meet their housing needs despite multiple economic challenges.

The contrasting trends between nominal and real property prices in Turkey reflect the ongoing challenges related to inflationary pressures in the real estate sector, while at the same time highlighting the continued demand in the housing market.