REIDIN.com - REIDIN.com INDEXFocus Turkey September 2010 Real Estate Sector Analysis

REIDIN.com INDEXFocus Turkey September 2010 Real Estate Sector Analysis - Residential

posted @ 12:00am, Monday 18 October 2010.

INTRODUCTION
The REIDIN.com Turkey Residential Property Price Indices (TRPPI) is designed to be a reliable and consistent benchmark of housing prices in Turkey. The purpose is to measure the average differences in house prices in a particular geographic market.
The monthly REIDIN.com TRPPI uses a stratified median index approach for index calculation with data covering the 7 major cities and their 71 districts, including Istanbul, Ankara, Izmir, Adana, Antalya, Bursa and Kocaeli. The national TRPPI (Turkey Composite Index) is a weighted average of those city indices.
Index series are set at 100 starting at the beginning of June 2007 and are calculated by using a moving average algorithm.

INDEX SUMMARY
• The residential sales prices increased 0.29% in Adana, 0.48% in Ankara, 0.60% in Bursa, 0.46% in Istanbul and 0.09% in Izmir; on the other hand, prices were down 0.47% in Antalya and 0.35% in Kocaeli during September 2010.
• The residential rent prices increased 0.20% in Adana, 0.50% in Bursa, 0.72% in Istanbul and 0.61% in Kocaeli; on the other hand, prices were down 0.13% in Ankara, 0.54% in Antalya and 0.11% in Izmir during September 2010.
• When adjusted by inflation rate according to the Consumer Price Index (+1.23%), the residential real estate investments caused a loss to the investors in real terms in September 2010. Accordingly, the rate of loss in real terms is 0.66% in Adana, 0.72% in Ankara, 0.76% in Antalya, 0.73% in Bursa, 0.69% in Istanbul, 0.76% in Izmir and 0.71% in Kocaeli on monthly basis.

DETAILED ANALYSIS
The monthly REIDIN.com TRPPI uses a stratified median index approach for index calculation with data covering the 7 major cities, 71 districts, and their 481 sub districts including Istanbul, Ankara, Izmir, Adana, Antalya, Bursa and Kocaeli. The national TRPPI (Turkey Composite Residential Property Price Index) is a weighted average of those city indices. Index series are set at 100 starting at the beginning of June 2007 and are calculated by using a moving average algorithm.

Table 1.1 REIDIN.com House Sales Price Indices (Nominal, June 2007 = 100)

	REIDIN.com House Sales Price Indices (Nominal, June 2007 = 100)
	Turkey Composite		ISTANBUL		ANKARA		IZMIR
Month	2009	2010	2009	2010	2009	2010	2009	2010
January	87.4	91.3	85.8	88.8	84.5	88.4	91.7	100.6
February	86.5	91.7	84.7	89.5	84.0	88.8	90.2	100.2
March	85.3	92.0	83.4	89.9	82.6	89.1	89.2	100.2
April	85.8	91.9	83.9	90.6	83.2	89.2	91.2	97.8
May	87.3	91.8	84.8	91.0	84.8	89.0	95.0	96.6
June	88.7	92.1	85.8	91.2	86.8	89.2	97.0	96.7
July	89.7	92.2	86.4	91.3	87.8	89.4	98.1	96.8
August	90.2	92.3	86.9	91.3	88.0	89.7	98.5	96.9
September	90.8	92.6	87.5	91.7	88.1	90.1	99.9	97.0
October	91.0		88.1		88.1		100.6
November	91.2		88.4		88.2		101.1
December	91.1		88.4		88.2		100.8
Average	88.7	92.0	86.2	90.6	86.2	89.2	96.1	98.1
Copyright © REIDIN.com
	REIDIN.com House Sales Price Indices (Nominal, June 2007 = 100)
	ADANA		ANTALYA		BURSA		KOCAELI
Month	2009	2010	2009	2010	2009	2010	2009	2010
January	95.0	103.2	89.9	85.6	87.5	90.4	94.2	104.7
February	94.0	102.9	88.6	85.2	87.5	90.9	96.1	105.6
March	94.9	103.2	87.8	85.1	85.0	91.4	94.9	105.6
April	95.0	103.4	85.8	84.4	86.1	91.1	95.2	105.8
May	95.8	103.7	86.7	84.8	88.1	91.0	96.3	106.3
June	96.6	104.5	88.1	85.9	90.7	90.9	99.1	106.0
July	97.8	105.0	90.5	85.9	92.3	90.5	101.9	106.1
August	98.6	104.5	90.5	86.7	92.4	90.5	104.5	106.2
September	99.3	104.8	89.8	86.3	92.5	91.0	105.6	105.8
October	100.5		87.9		91.7		105.6
November	101.9		86.6		91.2		105.0
December	102.8		86.0		90.9		104.9
Average	97.7	103.9	88.2	85.5	89.7	90.9	100.3	105.8
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Chart 1.1 Turkey Composite House Sales Price Index (Nominal, June 2007 = 100)

Chart 1.2 Turkey Composite Rent Index (Nominal, June 2007 = 100)

Table 1.2 REIDIN.com Rent Indices (Nominal, June 2007 = 100)

	REIDIN.com Rent Indices (Nominal, June 2007 = 100)
	Turkey Composite		ISTANBUL		ANKARA		IZMIR
Month	2009	2010	2009	2010	2009	2010	2009	2010
January	89.1	90.1	87.6	89.4	93.4	92.0	86.1	88.1
February	87.8	90.0	85.6	89.6	92.3	91.8	84.3	87.3
March	86.7	90.2	84.9	89.9	91.2	91.8	81.8	87.7
April	87.7	90.7	86.2	90.4	92.6	92.1	82.8	88.2
May	89.7	90.9	88.6	90.6	93.8	92.0	84.2	88.4
June	90.7	91.2	89.6	90.8	94.4	91.9	86.1	89.1
July	91.1	91.2	89.9	90.5	94.6	92.5	87.1	89.2
August	91.4	91.2	90.1	90.4	94.8	93.3	87.9	88.6
September	91.3	91.6	90.0	91.0	94.6	93.2	88.4	88.5
October	90.9		89.9		93.6		88.6
November	90.5		89.6		92.6		88.8
December	90.3		89.5		91.9		88.8
Average	89.8	90.8	88.5	90.3	93.3	92.3	86.2	88.3
Copyright © REIDIN.com
	REIDIN.com Rent Indices (Nominal, June 2007 = 100)
	ADANA		ANTALYA		BURSA		KOCAELİ
Month	2009	2010	2009	2010	2009	2010	2009		2010
January	96.5	105.1	90.8	85.2	88.5	87.4	99.5		97.3
February	98.5	105.6	89.4	84.9	90.8	86.8	98.4		98.4
March	98.7	106.8	88.2	85.4	90.5	86.2	95.0		98.5
April	101.3	108.1	87.3	85.4	90.9	86.4	92.6		98.5
May	104.6	108.2	88.5	85.6	92.2	87.3	92.4		98.4
June	108.4	109.1	90.5	86.2	92.2	87.8	92.2		98.0
July	108.9	110.6	91.5	86.1	91.9	88.5	92.1		98.2
August	108.7	112.2	91.9	85.6	91.6	88.0	92.4		98.5
September	107.9	112.4	91.2	85.5	91.3	88.5	93.5		99.1
October	106.2		89.4		90.5		95.0
November	105.1		87.2		89.2		96.0
December	104.1		86.3		88.4		96.6
Average	104.1	108.7	89.4	85.6	90.7	87.4	94.6		98.3
Copyright © REIDIN.com

Chart 1.3 % Change in Residential Sales Prices

The residential rent prices increased 0.20% in Adana, 0.50% in Bursa, 0.72% in Istanbul and 0.61% in Kocaeli; on the other hand, prices were down 0.13% in Ankara, 0.54% in Antalya and 0.11% in Izmir during September 2010.

Chart 1.4 % Change in Residential Rent Prices

When the residential real estate investments and the financial investment instruments are adjusted by inflation rate according to the Consumer Price Index (CPI), it is seen that the investment instrument having the highest monthly real return is the Istanbul Stock Exchange (ISE-100 Index).
When adjusted by inflation rate according to the Consumer Price Index (+1.23%), the residential real estate investments caused a loss to the investors in real terms in September 2010. Accordingly, the rate of loss in real terms is 0.66% in Adana, 0.72% in Ankara, 0.76% in Antalya, 0.73% in Bursa, 0.69% in Istanbul, 0.76% in Izmir and 0.71% in Kocaeli on monthly basis.
When adjusted by inflation rate according to the Consumer Price Index (+1.23%), the monthly real profit rate of Istanbul Stock Exchange (ISE-100 Index) and Gold (ingot) were 5.26% and 2.39%; while US Dollar, Euro and Deposit Rate posted loss of 2.36%, 0.83% and 0.59% respectively.

Chart 1.5 Residential and Financial Real Returns (%)

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REIDIN.com INDEXFocus Turkey September 2010 Real Estate Sector Analysis - Residential

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