Mortgage Boom in Turkey: Mortgaged Home Sales Jump 35.9% as Foreign Buyers Fall 20%

Turkey real estate in March 2026: a market of contrasts

The latest release from the Turkish Statistical Institute (TÜİK) for March 2026 shows a market pulling in two directions. On one hand mortgage-backed purchases rose sharply; on the other hand foreign buyer demand weakened. For anyone tracking real estate Turkey, these figures matter because they change bargaining power, financing risk and where investors should look next.

Our analysis finds the numbers both striking and cautionary. The headline: total residential transactions in March were 113,770 units, with mortgaged sales up 35.9% year-on-year to 25,978 units. By contrast, sales to foreign nationals fell by 20.0% to just 1,353 units. Those are not small swings, and they are likely to affect pricing dynamics, developer strategies and lending risk on a nationwide scale.

March snapshot: the data you need to know

TÜİK’s March 2026 release makes clear which market segments are expanding and which are contracting. Key facts from the report:

• Total residential transactions: 113,770 units
• Mortgaged sales: 25,978 units, +35.9% year-on-year
• Non-mortgaged (other) sales: down 9.6% year-on-year
• First-hand (new) home sales: 35,725 units, +1.3% year-on-year
• Second-hand sales: down 3.6%, but they keep a 68.5% share of the market
• Sales to foreigners: 1,353 units, -20.0% year-on-year, 1.2% of total sales
• Foreign buyer leaders in units: Russia 229, Iran 130, Germany 84

The release also includes seasonal adjustments. On that basis, first-hand sales fell 9.6% versus February, which signals a loss of short-term momentum among new developments.

Why mortgage activity spiked and what it means

The most striking single statistic is the 35.9% jump in mortgaged home sales. We have three practical observations for buyers and investors based on that shift:

1. Demand for credit is rising. Buyers appear willing or compelled to finance purchases rather than use cash. That changes the buyer profile in the market and reduces the share of investors or cash buyers who have usually set quick prices.
2. Lender appetite matters. When mortgage volumes surge, banks are underwriting and releasing capital at a higher rate. For investors, that means more buyers with financing in hand, which can support price stability in some segments but also raise default risk if underwriting standards loosen.
3. Pricing and negotiation power shift. Sellers who priced properties assuming higher cash buyer participation may face longer marketing times. Buyers using mortgages may still have leverage if lending is selective or subject to tightening.

Our view is that the mortgage surge is a sign of changing affordability dynamics. If household cash positions have weakened or if buyers expect prices to rise, they will rely on credit. That increases systemic exposure to interest-rate moves and borrower stress. Investors should watch bank lending criteria and the share of variable-rate mortgages in new production.

New-build versus resale: winners and losers

The market split between first-hand and second-hand homes is relevant for strategy. March figures show:

• First-hand sales up 1.3% to 35,725 units, but seasonally adjusted figures show a 9.6% month-on-month drop versus February.
• Second-hand sales down 3.6% year-on-year but they still account for 68.5% of transactions.

That tells us two things. First, resale stock remains the dominant supply channel. For buyers seeking immediate occupancy or lower sticker prices, the second-hand market is where volume and choice are concentrated. Second, although new-build sales rose slightly on an annual basis, the month-to-month drop signals short-term cooling for project launches and developer sales.

For investors preferring new developments, careful underwriting of delivery schedules and buyer pre-sale performance is now more important. For those targeting resale, competition remains high but negotiating margins may improve if cash buyers decline.

Foreign demand: why the slump matters

Foreign purchases fell to 1,353 units in March, a 20.0% drop year-on-year, equal to just 1.2% of total transactions. Russia led foreign buyers with 229 purchases, followed by Iran with 130 and Germany with 84.

A fall in foreign demand matters for several reasons:

• Areas and projects that relied on international buyers will see slower absorption and may have to adjust pricing or marketing strategy.
• Developers who priced with a foreign premium could face pressure on margins.
• Rental markets that catered to expatriates and international tenants may feel reduced demand, depending on segmentation.

We should be clear about limits to the data. TÜİK’s statistics record where title was transferred but not the motivations behind purchases. The decline may reflect currency shifts, tighter global capital flows, competition from other international markets, visa or travel constraints, or local regulatory changes. For market participants, the practical step is to test demand assumptions and diversify sales strategies rather than rely on a single buyer profile.

Commercial property: falling transactions but mortgage surge

The commercial or workplace segment showed weaker transactional volumes overall. TÜİK reported declines in both first-hand and second-hand workplace sales, with first-hand down 5.4% and second-hand down 12.3%. Yet, as in the residential sector, mortgage financing in this segment expanded dramatically, with mortgaged workplace sales up 60.1%.

Why that matters to investors

• A surge in leverage for commercial deals increases exposure for both lenders and borrowers. Leverage can amplify returns when occupancy and rents rise, and amplify losses when they fall.
• Falling transactional volume alongside higher mortgage use suggests that only buyers comfortable or forced to use credit remain active. That alters counterparty risk.
• For lenders, underwriting commercial loans in the current environment requires more granular cashflow analysis because vacancy risks and rent collection are uneven across submarkets.

Investors who target commercial real estate should insist on stress tests for tenant retention, rent growth assumptions and refinance timing. Those buying with debt should lock rates or structure covenants to protect against rapid interest-rate swings.

Practical advice for buyers and investors in real estate Turkey

If you are an owner-occupier, landlord or institutional investor, here are tactical steps to consider given the March numbers:

• Mortgage sourcing: Shop multiple lenders and compare loan-to-value (LTV) ratios, fixed vs variable rates, and early repayment penalties.