Attention-grabbing analysis from Reuters: ‘New packages for the housing sector will not be an analysis of the intended balancing in prices’
The representatives of the sector stated that the loan interest facility below 1 percent will bring vitality to the housing market and can contribute positively to the first hand sales by 20 percent; He draws attention to the fact that it is a problem to control the rise in housing prices in the short term due to rising costs, the depreciation of the lira and the weak course of new housing supply.
Within the scope of the measures announced, the government aims to increase the housing supply by providing cheap financing to housing producers under the obvious rules and thereby stabilizing the prices. However, the exclusion of projects that have not reached a completion rate of 40 percent and the rule of keeping prices fixed for one year in an official inflation environment of 70 percent reduce the chances of companies benefiting from this and thus reaching the target of the regulation .
On the other hand, while public criticism about the sudden increases in housing prices after the announcement of the packages, Finance Minister Nureddin Nebati also announced on Twitter that “some opportunists”
3 PACKAGED ANNOUNCED
In his statement after the cabinet meeting on Monday, Erdoğan stated that they decided to implement a series of measures to protect citizens from accidental fluctuations in the housing branch, and announced 3 packages for the department.
Two of As part of one of the packages, construction companies were offered access to long-term financing for the completion of housing projects that met the obvious criteria. Project, the construction projects, 40% of which are completed and 50% of which are unsold, will be financed in return for a commitment to keep the sales price of the hous e fixed for 1 year.
According to the CBRT data, the housing price index increased by 13.5 percent in February compared to the previous month and by 96.4 percent compared to the same month of the previous year. As for new houses, the price index increased by 102.2 percent annually throughout Turkey; The rate of increase was 114.6 percent in Istanbul and 119.5 percent in Ankara.
EXPECTED 20-25 PERCENT INCREASE IN SALES
Babacan Holding’s Executive Council Leader, which develops projects for the housing sector, İbrahim Babacan said, “With the interest rate of 0.99 percent, housing is a great investment even for those who do not need housing. It is a great opportunity to be able to borrow at 12 percent annually in an environment where the inflation rate is around 70 percent,” and added:
“With the demand created by those who want to use this opportunity, our sales will start with an increase of at least 20-25 percent compared to the previous months. I think the upper truth will go away.”
Babacan stated that despite the valuable support for house buyers, the financing package for house producers was insufficient to meet the need, and drew attention to the fact that many projects were out of scope due to the 40 percent completion rule .
Babacan stated that what is really needed is to provide a basis for new projects, but said that this way, the stock level in the market can be increased and the housing prices can be regulated indirectly.
Babacan said, “We have a new project of 1,000 houses that we have started. Since we are at the level of 20 percent in construction, we will not be able to benefit from this basis. There are also 8 -9 projects that we keep in our drawer. If there were incentives for new projects, we could use this financing opportunity and start. In our case, many There are companies,” he said, adding:
“When we want to obtain financing from the bank, the cost of the loan is around 30 percent. On the other hand, banks are actually very reluctant to give loans because the Central Bank has increased the provision price for loans in the last period and tightened the market. As the construction sector “We cannot find financing from banks. We are trying to act in a limited way with our own equity.”
Istanbul Builders’ Association Leader Nazmi Durbakalım pointed out the expectation that the scale would be stretched by 40 percent and said, “It would be much more beneficial if it was expanded to include projects that have received their license or started. Both in terms of employment and production.”
Indicating that many players have withdrawn from the department due to the rules, let’s wait said, “We hope that necessary arrangements will be made so that companies that have spent many years in the department but whose financial structure has deteriorated due to the conditions in recent years will also be able to benefit from these decisions.”
On the other hand, some housing producers point out that the condition of keeping prices constant for 1 year, even if they meet the other criteria, is not applicable in an environment of high inflation and cost increase.
Co-Founder of the housing manufacturer Mint, Sefer Altıoğlu, “Construction cost increase is around 10 percent on average per month. How will I endure the roughly 80 percent increase in costs in the next eight months, for example, because I will benefit from cheap loans? This is not very acceptable.” he said.
According to TUIK data, the construction cost index increased by 9.58 percent in March compared to the previous month and by 101.57 percent compared to the same month of the previous year.
Altıoğlu said, “We are not eager to enter new projects in this environment. Firstly, the costs are not predictable now. Secondly, if the cost increases continue, where is the purchasing power that we will sell it? The answer to those questions is not clear.”