Turkey's housing sales drop 12% in May

Housing sales in Turkey fell by 12.4 percent on a year-on-year basis during the month of May, mainly due to higher interest rates and a rise in the dollar exchange rate.
According to House Sale Statistics released Wednesday by the Turkish Statistical Institute, 90,377 houses changed hands in Turkey in May.
Of those, 1,610 were sold to foreigners, with approximately half of them in Antalya, the country's holiday hot spot, the government's statistics show.
Following the holiday resort province Antalya, where 652 houses were sold to foreigners, Istanbul ranked second in foreign housing sales with 406 houses. The southwestern province of Aydın ranked third with 150 houses.
In overall sales, Istanbul has maintained its top spot with almost 20 percent of the house transfers. The capital, Ankara, and the western province of Izmir followed, with 12.2 and 6.5 percent shares respectively.
On January 28, the Central Bank more than doubled its borrowing rate from 3.5 percent to 8 percent, and raised the lending rate from 7.75 percent to 12 percent to protect the Turkish Lira from sliding further.
The hikes in interest rates was expected to negatively affect the ability of mortgage borrowers to take new loans. Homes sold with mortgages accounted for 33 percent of those sold in Turkey in May.
The Turkish Lira tumbled to almost 2.4 to the dollar and 3.23 to the euro in the first month of the year and it was this plunge that was widely seen as endangering the Turkish economy, which is heavily dependent on dollar and euro pegged transactions and loans for the country’s everyday business.
Figures show that home sales have been rising over the years in Turkey, as the number of houses sold increased from 701,621 in 2012 to 1,157,190 in 2013, when 12,181 houses were sold to foreigners. Almost 40 percent of houses in 2013 were bought using a home loan.