Turkey has launched a new affordable housing scheme targeting low-income earners and first-time buyers to help reduce inflationary pressures caused by rising rents and support the housing sector.
Vice President Cevdet Yılmaz announced that the state housing agency, TOKİ, would manage the project, which will begin with the construction of 250,000 homes by mid-year.
To participate in the scheme, buyers must provide a 10% deposit and can repay the loan over a term of up to 20 years, with capped repayments. Eligibility is limited to individuals earning TL45,000 ($1,265) per month or less, which is about twice the current minimum wage.
Those who already own a house or have a spouse who does are excluded from the programme, addressing concerns that previous housing projects were being exploited by investors building multiple property portfolios.
The project will be implemented across all 81 provinces of Turkey, with a focus on urban areas with the highest demand. Contractors will be required to build energy-efficient homes using climate-friendly materials that are zero-waste compatible.
Economists predict that the introduction of 250,000 homes could reduce rental prices by up to 10% if all units are launched simultaneously, representing about 3-4% of the rental market. However, some experts, including real estate economist Dr. Ahmet Büyükduman, argue that a gradual rollout may not have the desired effect on inflation or rent prices.
In addition to the housing scheme, high rental costs were highlighted by Finance Minister Mehmet Şimşek as a key issue affecting the Turkish economy. Some economists suggest that providing incentives to the private sector, such as tax relief on housing with limited floor space, could be a more effective solution to Turkey’s housing shortage.
