Posted on 20 August 2010
The Turkish Central Bank’s Monetary Policy Board kept the benchmark interest rates unchanged Thursday, with the overnight borrowing rate at 6.50 percent and lending rate at 9 percent.
This is positive news for anyone considering buying a property in Turkey. Because Turkey made banking reforms in the 2001 crisis, liquidity has remained in the Turkish banking systems, and availability of mortgages largely unaffected by the crisis. Thus, foreigners who are able to obtain Turkish mortgages can currently do so very cheaply.
“But it is worth remembering that Turkish banks are reluctant to lend on properties that can not be seen and valued, thus borrowing tends to be on completed properties only,” said Julian Walker, director of Spot Blue.
The board issued a statement saying that a slight fall in foreign demand had been met by a gradual increase in domestic demand, but that: “It is estimated that it would take some time for capacity utilization in the manufacturing sector to return back to pre-crisis levels,” it said.
The board also said that despite positive news on the employment front, that joblessness was still too high, and also noted the risks in the shakiness of the international recovery as a whole.
The Central Bank doesn’t expect what it called soaring inflation to come back down until the fourth quarter of this year.