Türkiye's real estate investment trust Emlak Konut on Wednesday unveiled a new housing campaign that centers around middle-income buyers, featuring zero down payment plans with decreasing installments, a one-year grace period or a leasing model.
In recent years, Turks have been plagued by high rents and prices, which have made it harder to become a homeowner. The residential property market has also felt the impact amid soaring borrowing costs after a shift to aggressive monetary tightening since mid-2023 following years of easing policy.
The new campaign, unveiled by Emlak Konut GYO General Manager Yasir Yılmaz, offers three different payment options and covers 25 different projects in Istanbul, the Aegean province of Izmir, the southern province of Antalya and northwestern Balıkesir province.
"The need for housing is expected to continue to increase in the coming years," Yılmaz told a news conference in Istanbul. Türkiye's population increased by almost 300,000 last year to nearly 85.7 million. The figure is expected to exceed 88 million in 2030, said Yılmaz.
"This growth means that there will be new demands in the housing sector," he added.
The first model allows buyers to own a home without any down payment. The monthly installments decrease over time, with an interest rate of 0.99% and repayment terms of up to 60 months.
In the second model, the first 12 months of installments are covered by Emlak Konut, providing a 12% benefit to buyers.
In the second model, Emlak Konut will cover installments for the first 12 months, allowing homebuyers to go through the first year without any payments. That will provide buyers with an overall savings of 12%. The interest rate will be 1.29%, with repayment terms of up to 60 months.
The third model offers leasing-supported financing through Emlak Katılım participation bank. It will have a long-term and flexible payment option where buyers can own a home without a down payment or choose a preferred down payment amount.
The repayment terms extend up to 120 months, with flexible payment plans tailored to the buyer's budget. For example, a home valued at TL 6 million ($170,000) can be financed with 60-month installments starting at TL 61,698.
Applications for the campaign began on Wednesday, with the deadline set for March 23.
The starting price for the lowest-priced home in the campaign is approximately TL 5.65 million. The most affordable project in Istanbul is located in the district of Arnavutköy, said Yılmaz.
Interested buyers can apply and create payment plans through sales offices and call centers. There are no requirements for first-time homeownership, and there is no limit on the number of applications per family.
Environment, Urbanization and Climate Change Minister Murat Kurum on Tuesday said a social housing campaign for low-income citizens would also be launched by the end of the year.
Currency depreciation and the low rates pushed Turks into assets like real estate and cars in recent years to protect savings as inflation surged.
That saw real estate prices rise much higher than inflation throughout 2022 and 2023, before a slowdown last year.
Inflation, which peaked above 75% last May, fell to 42.12% on an annual basis in January. The central bank sees it cooling to about 24% by year-end.
To curb growth in consumer prices, the Turkish central bank raised its benchmark policy rate by 4,150 basis points between mid-2023 and March 2024.
Rate hikes typically lift borrowing costs for mortgages, auto loans and credit cards.
As inflation eased, the bank delivered cuts of 250 basis points each in December and January to lower its one-week repo rate to 45%. The rate is estimated to be lowered to 30% by the end of the year.
Despite the strict tightening, house sales in Türkiye rebounded in 2024 to grow by 20.6% to about 1.48 million units, returning to levels last seen in 2022.
Mortgaged sales dropped 10.8% amid high borrowing costs before the central bank launched the easing cycle in December.
House sales soared 39.7% year-over-year in January to 112,173 units. Mortgaged sales jumped 182.8% to 16,726, accounting for 14.9% of all house sales.