The need for housing in our country is increasing day by day. Many factors such as marriages, divorces, people wanting to move into separate homes, civil servant appointments, university students, and immigration create demand for housing.
Approximately 800 thousand houses are needed every year. However, since supply and demand are not in balance, housing prices are on the rise and rents are on the rise.
Vice President Cevdet Yılmaz announced that the Ministry of Environment, Urbanization and Climate is making preparations to produce low-cost housing.
Minister of Treasury and Finance Mehmet Şimşek also stated that the biggest reason for the high cost of living is rents.
WHAT WILL BE THE DETAILS OF THE PROJECT?
It is expected that a rule of 240 months maturity, 10 percent down payment, and household income not to exceed 45 thousand liras will be introduced for low-income people who will buy their first home. As in the projects carried out in the past period, there should be no housing for nuclear family members. In other words, if he is married, his wife should not have a residence. Those over the age of 18 can apply for housing if they meet the conditions. Since there will be projects focusing on the family in social housing, 2+1 and 3+1 residences are expected to be built.
HOW MUCH WILL THE PAYMENTS BE?
The solvency of someone with a household income of 45 thousand liras will be calculated and the average monthly payment will be in the range of 15-20 thousand liras. As is the case with TOKİ residences, installments may increase every year in line with the increase in civil servant salaries. However, TOKİ is trying to set this increase below the civil servant salary increase rate.
“IT IS ENCOURAGED WITH AFFORDABLE CREDITS”
Haluk Sert – Chairman of the Board of Directors of As Yapı
Providing financial support to those who will buy their first home, rather than social housing projects, stands out as a priority goal in housing policies. In this context, it is aimed to encourage individuals to become homeowners for the first time with affordable loans and financial support. Choosing this model instead of new projects offers a more realistic solution under current conditions.
“HOUSE PRICES AND RENTS WILL NOT FALL”
Although it takes a certain time for new projects to be completed, it does not seem possible to expect a decrease in prices and rents in the short term due to the lack of existing housing supply. In recent years, as housing production slowed down, a deficit of approximately 1.5-2 million houses was created. This demand pressure will continue until new projects come into operation and it seems likely that prices will tend to increase.
“DEVELOPING REGIONS DEVELOP”
These projects will play an important role in the development of developing regions in Istanbul. A large part (80%) of the existing housing stock in prestigious districts such as Etiler, Ulus, Beşiktaş and Nişantaşı consists of risky structures and these structures need to be transformed quickly.
“IT WILL BE DONE ON SOLID GROUNDS”
New projects will alleviate this congestion in the city and direct this concentration in the center of Istanbul towards the north and on more solid grounds. In this way, a more balanced and healthy growth will be achieved in the city. In addition, with the transformation of existing risky buildings, development in the city will accelerate and these regions will gain modern living spaces.
“240 MONTHS MATURITY OPTION IS A LOGICAL CHOICE”
In social housing projects, the 240-month maturity option may be a logical choice considering the value that the real estate will gain over time. For example, today’s installments are much lower than 5 years ago. With the effect of inflation and the increase in real estate prices, the total of long-term payments may be less burdensome with low installments like now. For this reason, it may be more advantageous to pay with a 20-year maturity.
“DEMAND WILL BE MEET”
We predict that this demand can be met within 3-5 years. With the decrease in interest rates and inflation, not only TOKİ but also contractors will accelerate housing production. Under these conditions, no problems are expected in meeting the increasing demand. Increasing the production capacity of contractors will contribute to maintaining the supply-demand balance.
“THE STATE IS MAKING MOVES TO SOLVE THE HOUSING PROBLEM”
Bulent Ozturk – arkaVev Chairman of the Board of Directors
While there are such big problems in first home ownership, I find every step and every action taken for this to be very valuable. The process that the construction industry is going through, the inflationary structure and the economic conditions are so challenging that our state is making certain moves in good faith to solve people’s housing problems. However, it cannot conclude these very quickly today. Continuity is essential in the state. The start of this work means that it will be completed by our state. Therefore, every new project contributes to solving the citizens’ need for affordable housing. I do not see the delays as a problem, attributing them to today’s economic conditions.
“DECREASE IN RENTAL PRICES MAY TAKE 2-3 YEARS”
The main reason for the high housing sales prices and rental prices in Turkey is that new housing production is below the need. An intense supply of social housing would perhaps not cause a very sudden decline. These declines are expected when housing production reaches its conclusion, that is, when houses are built and rented or when life begins. However, the distribution of demand to more points may cause housing sales prices to pause or decline slightly. It may take 2-3 years for rental prices to decrease.
“IT DOES NOT CREATE SOCIAL DISCRIMINATION”
We are a society living in many centers in Turkey. However, when we look at the world in general, in developed European countries or the United States, people live on the periphery further from city centres. Today, we see that important residential areas in our metropolitan cities are shifting out of the city. That’s why this phenomenon is now gradually accepted in society. It was taken for granted that we did not have to live in the centre. Therefore, this situation does not create a social divide.
“240 MONTHS TERM IS A HUGE SACRIFICE”
Housing with a maturity of 240 months is a huge sacrifice in terms of the economic dynamics of our country… If we follow the processes in recent years, it is much more advantageous to buy a housing with a maturity period of 240 months, that is, 20 years, regardless of the rate it is subject to. Especially with the civil servant raise rates, charging interest sounds like a great opportunity. Because today, in cash purchases, you cannot receive the house you purchase immediately, and since the construction process will take 2-3 years, I think it will be much more beneficial for the investor to spread it over the maturity period. Moreover, if we consider that high interest rates and inflation will continue like this for 1-2 years, the current cash value of the house alone may actually increase to a very large figure even after a few years. So today, when the investor invests his money in deposit interest instead of investing his money in cash on the house, perhaps most of the installments will be covered by the deposit, so in my opinion, it will be much more advantageous to buy it in installments.
“THE LARGEST LAND STOCK IN TURKEY IS IN THE STATE”
All parties in the industry should gather at the same table. This is not a situation that only TOKİ can prevent. At a point where we are talking about the annual need for 650-700 thousand housing units, the private sector and contractors need to play an active role in the process. However, one of the most important problems affecting contractors here is the high land prices. Today, the largest land stock in Turkey belongs to our state. If our state makes more motivating collaborations with private enterprise on its own lands, contractors can produce housing at much lower costs and naturally, citizens can have accessible housing. Therefore, our state cannot meet this supply alone. It should not be met… The process can be managed by supporting the private sector with incentives. In addition, the state needs to make very rational moves regarding its own land stock.
“LET’S BUILD SOCIAL HOUSING”
Merve Ertem Marangozoğlu – Luxury housing expert
Social housing projects are not a new development we hear about today. When we look at TOKİ, it has produced millions of houses and continues to do so. Despite the housing produced for many years, there has been no decrease in demand. The impact of the increasing population and developments regarding new population planning reveal the fact that more housing will be needed in the next 20 years. The reasons why the home ownership rate is so low should also be thoroughly examined. Many factors such as current income and inflationary environment hinder people’s appetite for investment.
social housing If we look at it from the side, as I said, it has been done before, but as is happening now, housing prices have increased almost 10 times in the last 4-5 years. Of course, social housing should be built, but the fact that it will have no impact on pricing in the city center remains aside.
“HOUSE AND RENTAL PRICES INCREASE”
Expecting prices to drop from today to tomorrow just because social housing will be built is a very utopian idea. There is no housing, it is not known what the project is, but it is a very wrong direction to say that housing and rental prices will decrease. The real estate sector, which has gone through difficult times in recent years, may be injured as a result of unconscious statements. If we need to evaluate the rights and wrongs and look at our habits from past to present, it is very difficult to expect that housing and rental prices in Turkey will decrease with social housing or within 2-3 years. There is a capital put forward, there are financial difficulties, there is the construction process. Why should the price of real estate, which is the output of these, be at or slightly above its cost? This situation has never happened in our country anyway, housing has always been seen first as shelter and then as an investment tool. I do not expect housing and rental prices to decrease, I expect them to continue to increase.
“IT IS BUILT IN AREAS CLOSE TO THE BLACK SEA”
I think that social housing will be built in areas on the outer edge of the city where there are no settlements yet or where there are small settlements. There are no huge plots left in the city center. In Istanbul, I think that social housing will be built in regions close to the Black Sea coast in terms of earthquake resistance.
“EVERYONE WHO HAS THE POSSIBILITY SHOULD BUY IT”
It is a great advantage to have a 10 percent down payment with a maturity of 240 months and the possibility of paying in installments of 15-20 thousand liras. However, the increase in installments in line with the civil servant salary increase implemented by TOKİ may increase the price of the house in the long run and strain the ability to pay. As you know, there is a gap between the increases made by the private sector and the state. However, with TOKİ’s periodic debt settlement campaigns, after a while, all the remaining debt can be paid off at once and the house can become much cheaper. No matter what, I recommend that those who meet the conditions to qualify for social housing buy it. Installments and remaining amounts are paid in some way; if not, the price of the house will increase at least 2 times on the day the keys are delivered.
CONTRACTORS MAY ALSO BE INVOLVED IN THE WORK
TOKİ is currently building hundreds of thousands of houses in Turkey. While TOKİ continues to work at full speed on construction sites for our citizens who lost their homes as a result of the earthquakes that affected 11 provinces and caused deep pain for all of us, it needs to receive support from existing contractors to start new constructions.
Social housing I expect that campaigns with suitable interest and maturity conditions will be announced so that the project will benefit not only TOKİ but also the contractors who have existing housing stock. In this way, the available stocks will be consumed in a short time, giving time for the houses to be built by TOKİ, and the housing demand will be met, at least to some extent, for this year.
I expect that the restrictions imposed on new and second-hand residences for those who want to buy their second home will be lifted soon.
Source: bigpara.hurriyet.com.tr
