The mortgage loan packages recently introduced by Turkish public lenders at historically low-interest rates have brought along a record surge in housing loans, which saw an increase of around TL 4.2 billion (nearly $613 million) last week.
Turkey’s three largest state lenders extended four new loan packages on June 1 to invigorate the transition to post-coronavirus normality and revive social life.
Ziraat Bank, VakıfBank and Halkbank’s packages include mortgages for new houses, loans for vehicle purchases, locally manufactured goods and holiday expenses at annual interest rates running below inflation.
Mortgages for new homes will have up to 15 years maturity, with interest rates as low as 0.64% and a grace period of up to 12 months, the banks said.
An average increase of TL 840 million in housing loans was recorded in the week between June 5-12.
According to the Banking Regulation and Supervision Agency (BDDK) data, the banks' loan volume increased by TL 36 billion in the two-week period between May 29 and June 12, reaching over TL 2 trillion.
In the same period, loans of public banks soared TL 17 billion to TL 1 trillion. In the two-week period, consumer loans increased by TL 14 billion, with public banks providing TL 9 billion of this figure. Consumer loans surged from TL 260 billion to TL 269 billion.
While housing loans increased by a record amount of TL 4.2 billion between June 5-12, public banks provided TL 3.7 billion of this increase. In the two-week period between May 29 and June 12, there was an increase of TL 4.9 billion in housing loans. Public banks were the pioneers in this increase with TL 4.1 billion.
In the meantime, residential property sales dropped by 44.6% year-on-year in May, but increased 19.1% on a monthly basis, signaling a recovery in demand in the real estate industry, according to official data.
According to the Turkish Statistical Institute (TurkStat) data, 50,936 residential properties, 16,860 new and around 34,000 secondhand, were sold in May.
Mortgaged house sales recorded a 23.9% increase at 18,483 – a 36.3% share of all sales over the same period.
Home sales are expected to rise significantly in June supported by the public lenders’ mortgage loan packages.
