Azernews.Az

By Bloomberg

Turkish home sales jumped the most this year as stabilized interest rates spurred a surge in mortgage loans.

The number of homes sold jumped 25 percent to 95,645 in October, with mortgage sales rising 31 percent, according to data published by the state statistics office in Ankara today. The average cost of a home loan in the month was 10.7 percent, according to data compiled by Bloomberg, three percentage points below the high in April, after a probe into alleged government corruption led to a sell-off in Turkish markets and a surge in interest rates.

Easier credit coupled up with aggressive marketing strategies is also lifting prices. Home prices in Istanbul, the nation’s largest city, rose more than 24 percent in August from a year earlier, the fastest since official data began in 2010, according to the central bank. Prices nationwide rose at an annual rate of 15 percent. While the bank held its main interest rate at 8.25 percent last week, it will probably look to cut again next year, according to Goldman Sachs Group Inc.

“February-April 2015 would provide the central bank with an ideal opportunity” to start cutting rates, with inflation expected to decline in that period, Goldman Sachs economist Ahmet Akarli said in an e-mailed report on Nov. 21. The bank will probably cut its main one-week repo rate by a cumulative 125 basis points to 7 percent next year, he said.

The real estate investment trust index on the Borsa Istanbul has gained 5.7 percent in the past month, outperforming the 4.3 percent gain on the main index. Emlak Konut Gayrimenkul Yatirim Ortakligi AS, the nation’s largest developer, is up 7.6 percent over that period.