According to Endeksa, a real estate market data and statistics organization, the average house price in Turkey in May 2024 was 3.4 million Turkish Lira (approximately $103,000). House prices rose 48.47 percent year-on-year and 0.36 percent month-on-month. After adjusting for inflation, house prices increased by 14% year-on-year, but decreased by 3% sequentially.
According to Endeksa's research, the average house price in Turkey is TL 25,931 per square meter. The capital city of Ankara saw the highest annual increase in house prices at 55.3 percent, but real house prices fell 10 percent to an average of 2.8 million liras. Istanbul house prices rose 48.2% year-on-year but fell 14% in real terms, with an average price of 4.6 million liras. Antalya, one of the popular vacation resorts where foreigners are buying properties in large numbers, had an average house price of 4.1 million liras, up 37% from May last year, but down 21% in real terms.
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Another study by Istanbul Bahçeşehir University's Center for Economic and Social Research (BETAM) showed that, in real terms, average rental prices fell 14 percent in May compared to the same month in 2023. The report noted that the current annual growth rate of rental prices continues to decline, noting that the year-on-year increase in the average price of rental housing advertised across Turkey slowed to 49.8 percent in May. In real terms, rental prices in Istanbul declined by 13.3 percent year-on-year, while Ankara and the western province of Izmir saw a 1.2 percent year-on-year decline.
Economic relations between Turkey and the United Arab Emirates (UAE) have been deepening, with the UAE appreciating Turkey's strong economy and expressing interest in investing in a number of sectors, including energy, agriculture, transportation and tourism. During Turkish President Recep Tayyip Erdogan's visit to Abu Dhabi in July last year, Turkey and the UAE signed agreements worth $50.7 billion (about 1.66 trillion Turkish liras), of which energy deals accounted for more than half.
Inflation expectations in Turkey have fallen to their lowest level in a year, according to a survey released by the central bank on Friday.Expectations for inflation 12 months from now fell to 31.8 percent in June, down from 33.2 percent previously. This shows an easing of inflationary pressures, especially in light of a series of interest rate hikes and a relatively stable Turkish lira. Finance and Treasury Minister Mehmet Şimşek welcomed the drop in expectations and said it would help accelerate the deflationary process.
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Vice President Cevdet Yılmaz said expectations are converging on the government's forecast path, something the authorities have sought to ensure. Expectations for the consumer price index (CPI) at the end of the year fell to 43.5 percent from 43.6 percent in the last survey. The central bank last month raised its year-end growth forecast to 38 percent. Since last June, the central bank has gradually raised its benchmark policy rate to 50 percent from 8.5 percent and said it would "make every effort" to prevent the inflation outlook from worsening.
Despite the expected decline, the central bank is expected to keep the one-week repo rate unchanged for the third consecutive month at the June 27 meeting of the Monetary Policy Committee (MPC). The survey showed that inflation is expected to fall to 20.3 percent from 21.3 percent in two years. Yilmaz reiterated the government's goal of reducing unemployment to below 20 percent by 2025 and achieving single-digit unemployment by 2026. He also noted that a period of deflation starting in the second half of 2024 would contribute to the goal of stabilizing growth and sustained increases in social welfare.
