Turkey’s housing sales down in 2006 as prices rise / istanbul-bilbao

Prices in the Turkish housing market surged last year, causing sales to decelerate as a consequence. A recent study using data provided by the Land Registry Office revealed that 1,377,533 properties were sold across Turkey in 2006 while some YTL 38 billion was earned from these sales.

According to the figures, housing sales had increased by 10.16 percent in 2003, 19.5 percent in 2004 and 12 percent in 2005. However, 2006 witnessed a dramatic slowdown with only a 1 percent increase. On the other hand, the revenue pulled in from these sales rose by 14.7 percent, largely thanks to the buoyant prices. Real estate agents claim the 1 percent increase doesn't reflect "real sales," adding that market fluctuations in May and June 2006 caused the market to shrink by 20 percent.

Ankara All Real Estate Agents Chamber (ATEM) Chairman Hacı Ali Taylan opined that the increase in the number of houses sold in 2006 was artificially inflated and could be traced back to two reasons: The first is “sales by arrangement,” in which landowners sell their properties to family members to be able to use lower-interest housing loans for other purposes. The second might be that many properties had been sold the year before, but deed transfers were not completed until 2006. Taylan also claimed the increase in total sales was not because of the increase in prices. “That was because unit values were added per square meter for property taxes. Showing property values higher than the real value to be able to get a higher loan from the bank is another reason,” Taylan said. Meanwhile, the data indicated the most valuable properties in Turkey are in İstanbul. Last year, 188,578 houses were sold in İstanbul, with buyers paying YTL 12.4 billion in total to the sellers. This shows that sales dropped by 8.7 percent compared to 2005 in İstanbul, whereas total sales realized jumped by 30 percent.

The picture in the capital, however, was somehow reversed. In Ankara sales decreased by 5.7 percent and 134,735 units of real estate were sold in 2006. Moreover, the revenue earned from these sales also dropped by more than 32 percent. As a result, landowners in Ankara were able to earn only YTL 3.99 billion from these sales.

In İzmir, the number of properties transacted contracted from 82,494 to 78,028 while the money earned reached YTL 2.4 billion after a slight increase. Antalya, the subject of considerable foreign interest, the number of sales stayed nearly stable, yet there was a drastic decline in revenue. A total of 50,751 units were sold in the city in 2005, dropping to 50,707 in 2006; yet, revenue decreased from YTL 2 billion to YTL 1.7 billion. istanbul-bilbao

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