Home prices in Turkey rose by 11.31% y/y in August, data from the central bank showed on October 27, but the gain was short of the 11.61% y/y posted for July.
On a monthly basis, prices rose 0.77% in August versus 0.67% in July.
Prices of new dwellings increased by 0.87% m/m in the month after rising 0.65% in July, while the annual rise accelerated to 11.01% y/y from 10.58% y/y, central bank data also showed.
Expectations for Turkey's end-2017 inflation rate have risen from 9.72% in September to 9.89% in October. The Turkish government expects inflation to fall from 9.5% this year to 7% next year and to 5% by 2020.
Fitch expects Turkey’s annual inflation rate to be 9.5% at end-2017 while its forecasts for 2018 and 2019 stand at 8% and 7.8%, respectively.
The IMF predicts in its October World Economic Outlook that Turkey’s CPI inflation will be 10.9% this year, up from the 10.1% anticipated in the April report, and 9.3% in 2018, up from its previous estimate of 9.1%.
The World Bank also forecasts an end-2017 CPI inflation for Turkey of 10.1%.
In the first nine months of the year, home sales in Turkey increased by 10% y/y to 1.03mn units.
A record high 1.34mn residential units were sold in the country last year, marking a 4% y/y increase. A total of 1.29mn units were sold in the country in 2015, 11% up on the 2014 figure.
The government has been trying to stimulate housing demand with a number of measures. Government ministers, as well as Turkish President Recep Tayyip Erdogan, have, for instance, been calling on Turkey's banks to cut interest rates on home loans, while VAT levied on home sales has been reduced.