Turkey plans 20-year, low cost mortgages for poorest citizens

Turkey’s government is working on plans to introduce 20-year mortgages at low rates of interest for the poorer segments of society, Treasury and Finance Minister Berat Albayrak said.

The cost of the loans will be lower than paying rent, Albayrak said during a speech in the northeast city of Samsun on Thursday, according to local media including Dünya newspaper.

The government has established the financial infrastructure for the new loan incentives, Albayrak said, adding that he will announce details of the model later this month during a special event with President Recep Tayyip Erdoğan.  

Turkey is seeking to stimulate economic growth and to raise living standards after a currency crisis that erupted last year sparked a recession, sent unemployment surging and living standards spiralling downwards. The construction industry has been among the worst affected by the turmoil.

State-run banks have reduced interest rates on mortgages to less than 1 percent monthly this year. The rates compare with inflation of 8.6 percent.