New BDDK Mortgage Rules Revive Turkey’s Housing Market

Prospective homebuyers in Turkey may soon find it easier to access mortgage financing following new regulatory changes introduced by the Banking Regulation and Supervision Agency (BDDK). Sector representatives say the updated rules could boost housing sales, ease access to credit, and help rebalance a market that has struggled under tight financing conditions in recent years.

The BDDK announced a series of coordinated macroprudential measures to support financial stability. These measures include restructuring individual credit card and consumer loan debt, new limits on credit cards and overdraft accounts, and significant changes to loan-to-value (LTV) ratios for housing loans.

One of the most notable changes is the removal of the distinction between first-hand and second-hand homes when determining mortgage eligibility. In addition, residential properties built after 2010 and holding at least a Class C energy efficiency certificate have been included in the category eligible for more favorable LTV ratios.

According to the regulator, the adjustments are designed to encourage the purchase of energy-efficient, relatively earthquake-resistant homes and to support consumers seeking to buy their first property.

Sector Sees Boost to Sales and Financing Access

Industry representatives broadly welcomed the changes, describing them as a positive step toward revitalizing housing demand and improving access to financing.

Ziya Yılmaz, Chairman of the Housing Developers and Investors Association (KONUTDER), emphasized the importance of removing restrictions on second-hand housing.

“Eliminating the distinction between first-hand and second-hand homes in housing loans and allowing second-hand properties to be included more effectively in mortgage financing is an important and positive step for the housing market,” Yılmaz said. “With inflation trending downward, it is also crucial to review other constraints that limit access to credit.”

Yılmaz highlighted the sharp decline in credit-backed housing sales over the past decade. He noted that the share of mortgaged home sales in total housing transactions has fallen from around 30 percent to 14 percent. During the same period, the share of first-hand home sales with mortgages fell from 15 percent to 3.5 percent, alongside a similar decline in the overall share of newly built homes.

Financing Constraints Limit New Housing Supply

According to Yılmaz, ongoing credit restrictions on second- and third-home purchases continue to suppress construction activity and new housing supply.

“Addressing first-hand housing production and sales within an accessible and credit-compatible financing framework is critical for increasing safe housing stock and ensuring a healthy and sustainable balance in the housing market,” he said.

He added that growth in new home sales would support not only the construction sector but also approximately 250 related sub-sectors and employment. Expanding the supply of safer buildings, Yılmaz noted, is essential for renewing Turkey’s housing stock and strengthening resilience against natural disasters.

“For this reason, designing housing finance mechanisms in harmony with first-hand housing production and sales will generate higher added value in terms of production, employment, and economic growth,” he said.

“A Well-Timed Step to Ease Credit Access”

Mustafa Ekiz, Chairman of the Real Estate and Construction Platform, described the new regulations as a well-judged intervention.

“This is a timely step taken to facilitate consumers’ access to credit, strengthen financial stability, and ensure the efficient use of resources,” Ekiz said.

He also welcomed the inclusion of energy-efficient homes in the more favorable credit category and called for parallel action at the local government level.

“We appreciate the support provided to energy-efficient housing through favorable loan ratios,” Ekiz said. “We expect the same sensitivity from municipalities when issuing construction permits for these projects and call for faster licensing processes.”

Second-Hand Homes Become More Attractive

Hakan Şişik, Chairman of the Anatolian Side Contractors Association (AYİDER), noted that mortgage conditions had previously favored newly built homes.

“With the removal of this distinction, second-hand homes will also become more attractive in terms of access to credit,” Şişik said. “This could bring renewed momentum, particularly to urban transformation projects.”

Şişik expects middle-income households to increasingly turn toward second-hand housing as financing becomes more accessible.

“This is an important move for reducing older but earthquake-resistant building stock,” he said. “The regulation provides an advantage to first-time homebuyers, which will help keep demand alive and support sales.”

However, Şişik stressed that lower interest rates remain a key expectation for the sector.

“Our main demand is for mortgage interest rates to fall below 2 percent,” he said. “If that happens, investors who have shifted toward gold and silver may return to the real estate market. As we have stated before, we expect noticeable market activity, especially in the second half of the year.”

Addressing the Real Needs of the Housing Market

Mustafa Kemal Şahin, Chairman of the Association of Real Estate Marketing and Sales Professionals (GAPAS), said the new rules respond directly to the market’s most pressing needs.

“Updating loan usage ratios for first-time homebuyers and removing the first-hand versus second-hand distinction is a correct step that addresses the real needs of the housing market,” Şahin said.

He emphasized that limited access to financing has been the primary obstacle facing housing demand for an extended period.

“This regulation will revive the hope of homeownership, particularly for middle-income groups, and help create healthier and more balanced market activity,” Şahin said. “However, adjusting loan ratios alone is not sufficient.”

According to Şahin, a lasting solution requires a predictable interest-rate policy, production models that increase housing supply, and targeted incentives for first-time buyers, all implemented simultaneously.

“Our core position is clear,” he said. “Housing is not a luxury but a necessity, and financing should not be a privilege but an accessible right. We will closely monitor the outcomes of this process and continue to provide constructive input on behalf of the sector.”