Turkey’s construction sector is expected to revive in the third quarter of next year, said the head of the Anatolian Side Contractors Association, a construction group operating on the Anatolian side of İstanbul, according to the Hürriyet Daily News.
The sector has had a difficult time since August 2018, but the central bank’s interest rate cuts have been supporting the sector since the end of last summer, Melih Tavukçuoğlu said.
Last year the Turkish economy suffered a currency crisis, with the national currency losing 30 percent of its value against the US dollar, eventually resulting in a rise in costs and high interest rates and leading stagnation in the construction sector.
The central bank has cut interest rates by 1,000 basis points over the last four months, from 24 percent to 14 percent.
Private and state banks currently provide home mortgages at interest rates of 0.8 percent and 1 percent, respectively.
“These levels, up to 0.7 percent-0.8 percent or even 1 percent, are very good for our sector,” Tavukçuoğlu said.
Housing demand is not at the desired level but is much better compared to one-and-a-half years ago, he added.
Some 700,000 new houses are built annually in Turkey, while over a million housing contracts, including for previously lived-in units, are closed.