With interest and price down, credit up 50 pct
Güncelleme Tarihi:
by Esra Sahici - Hurriyet
Oluşturulma Tarihi: Şubat 10, 2009 00:00
ISTANBUL - Number of house loans used has increased 50 percent in the past two months, according to Garanti Mortgage Vice President Burak Ali Göçer.
Although the Turkish real estate sector was hit by stagnation in the global economic crisis, some activity has started. The drop in house prices reached 30 percent and shock reductions in loan interest rates occurred in January. These two factors have apparently activated the potential buyer who was waiting for such an opportunity. The number of housing credits used has risen 50 percent when compared to the last two months of 2008.
In the last quarter of 2008, where home loans nearly reached the point of ceasing, interest rates were up to 2 percent. However, figures have changed in the first month of 2009. Following the Turkish Central Bank’s shocking interest rate reduction, banks lowered their interest rates one by one for home loans. The new interest rate for banks has reached 1.42 percent, which in turn thrilled many consumers.
Volume of home loans
Compared to November and December of 2008, the volume of home loans banks have allocated increased in January 2009. While at some banks this increase exceeded 50 percent, the average increase was around 40 percent.
Main factors in this increase were that home prices stayed flat and that consumers were able to foresee the future of the sector to some extent.
The drop in interest rates is of course another factor. Also, special offers from companies were an important component triggering this increase.
Although there was an increase in the number of home loans in January, the total housing credit portfolio continued to shrink, from 39 billion to 37.2 billion Turkish Liras in the last week of January. Bankers said the decrease in interest rates triggered an increase of 50 percent in newly allocated credits, but current credits experience a high rate of liquidation.
Yapı Kredi Bank Home Financing Department Head İsmet Erdem said the amount of credits allocated has increased more than 50 percent compared to the last two months of 2008. "There was a steep increase in January compared to November and December. The sudden drop in interest rates is playing a major role in this. Also consumers who found the housing prices satisfactorily low have taken action to turn this into an opportunity."
In the last quarter of 2008, where home loans nearly reached the point of ceasing, interest rates were up to 2 percent. However, figures have changed in the first month of 2009. Following the Turkish Central Bank’s shocking interest rate reduction, banks lowered their interest rates one by one for home loans. The new interest rate for banks has reached 1.42 percent, which in turn thrilled many consumers.
Volume of home loans
Compared to November and December of 2008, the volume of home loans banks have allocated increased in January 2009. While at some banks this increase exceeded 50 percent, the average increase was around 40 percent.
Main factors in this increase were that home prices stayed flat and that consumers were able to foresee the future of the sector to some extent.
The drop in interest rates is of course another factor. Also, special offers from companies were an important component triggering this increase.
Although there was an increase in the number of home loans in January, the total housing credit portfolio continued to shrink, from 39 billion to 37.2 billion Turkish Liras in the last week of January. Bankers said the decrease in interest rates triggered an increase of 50 percent in newly allocated credits, but current credits experience a high rate of liquidation.
Yapı Kredi Bank Home Financing Department Head İsmet Erdem said the amount of credits allocated has increased more than 50 percent compared to the last two months of 2008. "There was a steep increase in January compared to November and December. The sudden drop in interest rates is playing a major role in this. Also consumers who found the housing prices satisfactorily low have taken action to turn this into an opportunity."