BETAM Report: Housing Price Bubbles Widespread in Türkiye, Some Still Persist Despite Tight Monetary Policy

A recent study by Bahçeşehir University’s Center for Economic and Social Research (BETAM) reveals that Türkiye’s housing market experienced 23 separate price bubbles between 2010 and March 2025. The report, based on Central Bank housing price indices, shows that the post-pandemic real estate boom triggered unsustainable surges in home prices across the country. While many of these real estate bubbles are now deflating due to tight monetary policies, BETAM warns that systemic risk remains.

Bubbles Detected Nationwide — Some Still Active

The report, titled “Housing Price Bubbles in Türkiye” and prepared by Gökhan Şahin Güneş, highlights that every region in Türkiye experienced at least one housing bubble in the aftermath of COVID-19. While price corrections are underway in several areas, persistent overvaluation remains in parts of Eastern and Southeastern Anatolia, including Erzurum, Malatya, Van, and Hakkâri.

23 Distinct Bubble Phases Recorded Between 2010 and 2025

According to the analysis, from January 2010 to March 2025, a total of 23 housing bubbles were identified. Istanbul (TR10) saw the highest number, with three distinct bubble phases. Other areas with repeat patterns included Edirne–Kırklareli–Tekirdağ (TR21) and Hatay–Kahramanmaraş–Osmaniye (TR63). Most other regions experienced one bubble event, confirming a nationwide housing volatility trend.

Longest-Lasting Bubbles Were in the East

The longest-duration bubbles were concentrated in Eastern Türkiye. In the TRB region (Malatya, Elazığ, Bingöl, Van), price inflation persisted for 35 months between May 2022 and March 2025. A similar 35-month bubble occurred in the TRC region (Gaziantep, Diyarbakır, Şanlıurfa), spanning April 2021 to March 2024. These extended periods of inflated pricing underscore the fragility of regional housing markets.

Adana-Mersin Recorded the Largest Price Surge

Among all regions, the Adana–Mersin (TR62) area experienced the most extreme price growth, with housing costs rising 112.7% between August 2021 and August 2023. Other significant spikes occurred in:

• Ankara (TR51): +111.8% (Nov 2021 – Nov 2023)

• Aydın–Denizli–Muğla (TR32): +110.4% (Jun 2021 – Jan 2024)

• Konya–Karaman (TR52): +105.3% (Sep 2021 – Jul 2024)

• Edirne–Kırklareli–Tekirdağ (TR21): +100.2% (Feb 2022 – Jan 2024)

These figures reflect not only regional demand surges but also the influence of loose credit conditions during the inflationary period.

Tight Monetary Policy Begins to Cool the Market

BETAM’s most critical finding is that tightening monetary policy since 2023 has started to cool Türkiye’s overheated housing market. The report emphasizes that housing bubbles are not solely the result of supply-demand imbalance; they are also fed by easy financing and weak regulatory oversight. As interest rates rise and credit access tightens, the data suggests a slow but steady correction in inflated property values—though not uniformly across all regions.