Turkey’s Bold Housing Fix: Tradable Property Certificates, 50-Year Mortgages and 500,000 Social Homes

A tipping point for real estate Turkey — what buyers and investors need to know

For anyone tracking real estate Turkey, the last year has been a shock. House prices have risen nearly 21-fold over the past decade while rents climbed almost 15-fold, and the government is responding with a package of financial innovations and large-scale construction that could change who can afford a home.

The headline measures are familiar and unfamiliar at the same time: tradable real estate certificates listed on Borsa Istanbul, plans to extend mortgage maturities from the current 10 years to 30–50 years for low-income families, and a target to build 500,000 social housing units in the next 2–3 years. Each move aims to tackle affordability but carries trade-offs. In this article we explain the mechanics, the numbers, and the practical implications for buyers, renters and investors.

Why Turkey’s housing problem looks different from other countries

Turkey’s housing story is extreme on some measures and ordinary on others. The scale of price and rent inflation is what separates it.

• Rents inflation was 82.97% year-on-year in June 2025.
• Over the past decade housing prices grew almost 21 times while rents rose almost 15 times. These are not small cyclical swings.
• Homeownership has fallen to 56.1%, well below the OECD average of 70.9% when mortgage-backed ownership is included.
• 84.8% of households reported that housing costs put pressure on their budgets in 2024.

These figures point to deep affordability pressures. One clear signal is the drop in mortgage-financed home sales: mortgage share peaked at 38.24% in 2020 but plunged to 10.72% in 2024, recovering slightly to 11.9% in 2025 as borrowing costs soared.

We should be blunt: the main problem is not enthusiasm for housing; it is the cost of finance combined with high absolute prices compared with household incomes. Mortgage rates averaged around 42.56% (figures vary slightly by source), which makes loan-servicing unaffordable for most households.

The real estate certificate experiment: structure, opportunity, limits

The most novel policy is the tradable real estate certificate program. It is being launched by state developer Emlak Konut with the Damla Kent project in Istanbul’s Başakşehir district.

How the certificate model works

• Certificates are listed on Borsa Istanbul and priced at ₺7.59 each.
• Buyers can accumulate certificates until they own enough to convert them into full ownership of a unit, or trade certificates on the market, or receive revenue from unsold units.
• To fully own a 62 m² 1+1 apartment in Damla Kent an investor needs 631,516 certificates (₺4.79m); a 88 m² 2+1 needs 863,276 certificates (₺6.55m).
• The public offering runs Aug. 4–8, with trading to begin on Aug. 11.

Potential positives for households and small investors

• The certificate model removes traditional down payment or mortgage entry barriers and introduces a path to ownership that can be funded gradually through secondary-market purchases.
• Liquidity is provided by market trading. For some households this is a financial-savings alternative to either paying rent or attempting to save for a mortgage deposit.

Key limits and risks we see

• The units in Damla Kent are priced at ₺77,311 per m² for 1+1 units and ₺74,458 per m² for 2+1, above Istanbul’s 2025 average of ₺63,279 per m². Basaksehir’s local average was ₺55,576 per m² in June. That gap raises an obvious affordability question.
• Certificates are financial instruments; trading can expose holders to price volatility. If market sentiment turns, certificates could fall in value even as nominal home prices remain high.
• The program depends on a functioning public market and investor confidence in state-backed projects. If liquidity is thin, converting certificates into a home may be slow or expensive.

Our reading is that certificates widen the menu of routes into housing ownership, but they do not reduce unit cash prices. For buyers whose main barrier is mortgage servicing costs, certificates help only if the market allows gradual accumulation at stable prices.

Mortgage maturities stretched to 30–50 years: relief or new risk?

Extending mortgage terms is an obvious way to reduce monthly payments. Finance Minister Mehmet Simsek said the government is planning to extend mortgage maturities for low-income families from 10 years to 30–50 years.

Basic arithmetic explains the attraction: longer terms lower monthly instalments for the same principal. But in Turkey’s case there are complicating factors:

• Mortgage interest rates are extremely high: between 19.11% in 2022 and 42.79% in 2024, easing slightly to 41.11% in 2025. At those rates, longer terms reduce the monthly burden but increase total interest paid substantially.
• Example data: for an average national home priced at ₺4.36 million, a 10-year mortgage at ~42.56% results in a monthly payment of about ₺134,775. In Istanbul this figure rises to ₺179,514. Stretching maturities could materially cut those monthly figures but not necessarily to levels aligned with household incomes.

What this means for buyers and the market

• If mortgages become available at 30 years but rates stay near 40%, buyers will be paying enormous interest over time. The measure is more sustainable if accompanied by lower, stable rates and income-linked underwriting.
• The key metric for mortgage viability is not maturity alone but the ratio of monthly payment to household income. Many Turkish workers earn no more than 50% above the minimum wage—the DISK-AR report suggests their monthly income does not exceed ₺33,156—so even extended-term mortgages at current rates may not be affordable.
• From an investor perspective, longer mortgage terms can increase owner-occupier demand and reduce speculative flipping, which can help rental markets. But poor underwriting standards or artificially long tenors without rate moderation create credit risks for banks and the state.

We think extended maturities are useful when paired with credible rate policy, prudent credit checks and targeted subsidies for lower-income borrowers.

The 500,000 social housing push: supply that could matter

A familiar policy lever is to increase supply, and the government is planning 500,000 social housing units within 2–3 years, coordinated with the Urbanization Ministry and state agency TOKİ.

Context and scale

• TOKİ has built over 1.5 million units in the past 20 years. The proposed 500,000 new units would be roughly one-third of TOKİ’s two-decade output and near Turkey’s current annual new housing completion figure of 540,096 (annual basis as of March 2025).
• New supply skewed to social housing could relieve rental pressure in the segments most in need and increase overall homeownership if targeted well.

Practical issues to watch

• Location matters. If new units are built at the urban periphery with poor transport and jobs access, they may not reduce effective housing costs for working households.
• Speed and construction quality are concerns. The country’s reconstruction needs after the tragic Feb.