Turkey's Erdogan announces measures to address soaring housing prices
ISTANBUL, May 9 (Reuters) - Turkish President Tayyip Erdogan announced several measures to address soaring real estate prices on Monday, as residents struggle to find affordable homes to rent or buy after last year's currency crisis.
Housing prices have surged over the past year, stoked by inflation which hit 70% in April, an ailing currency, a hot property market, as well as a growing local population in addition to a steady influx of immigrants. read more
Speaking after a cabinet meeting, Erdogan said cheaper housing loans would be provided to those who convert their forex savings to lira or sell their gold to the central bank to use in purchases of houses worth up to 2 million lira.
The rates on the loans would be a monthly 0.89% with a maturity up to 10 years, he said.
Ankara has urged individuals and companies to convert their forex savings to lira in the wake of the currency crisis, prompted by a series of unorthodox rate cuts engineered by Erdogan.
Erdogan said the measure on housing loans would support this effort, reversing a years-long dollarisation trend.
He said loans of up to 2 million lira with a monthly rate of 0.99% and a maturity of 10 years would be provided to first-time home owners.
Loans with 36-month maturities would be provided to construction companies to complete some projects if they promise to keep sale prices unchanged for a year, Erdogan said.
"With this we aim for projects under construction to be completed quickly, increasing the housing supply in the short term and thereby bringing the prices to balance," he said.
A construction boom has helped drive economic growth through Erdogan's nearly 20 years in power.
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