Posted on 25 March 2009
Ziraat Bankasi, Turkey’s largest state owned bank has been among the first to pass the central bank rate cuts onto consumers. Turkey’s central bank recently cut Turkey’s equivalent to the base rate to 10.5%, the latest in a series of cuts which has seen the rate cut by 6% in 5 months.
The monthly interest on the loans will fall to 0.99 percent from 1.89 percent, Ziraat chief executive Can Akın Çağlar told reporters in Ankara yesterday. Interest on home loans will drop to 1.29 percent from 1.49 percent and on car loans to 1.19 percent from 1.75 percent, he added.
Existing consumer loans will have their terms extended up to four years and credit card debts by as much as two years. But Çağlar said that customers who are in arrears with payments won’t be able to apply for the revised terms.
Çağlar also called on other banks to follow suit in passing the rate cut onto consumers, he said:
“This has nothing to do with being a state bank” and the fact that the change takes place just before local elections on March 29 is “completely coincidental,” he said. “I expect other banks to carry out similar adjustments.”
The rate cut is excellent news for overseas property buyers currently considering buying a property in Turkey. Turkey property is currently experiencing a surge in popularity with overseas lifestyle buyers and investors, though the latter making up a much smaller part of the market than it did this time last year. However, the increase in lifestyle buyers has more than made up for the drop in investors.
Many industry experts are still recommending property investment in Turkey, including Liam Bailey of Write About Property, in a recent opinion article he wrote: “All in all I would certainly make a long-term investment in Turkey, for holiday home investors it is even better.”