Is there a Housing Bubble in Turkey?

Abstract

There was a notable housing price inflation in aggregate/local levels in Turkey during the last few years. Although the country’s economic fundamentals remain strong, the probability of a housing bubble is a heated debate among market participants. This timely investigation brings greater clarity to whether the Turkish housing market is in a bubble. The study uses a multi-strand approach to dissect the bubble over the period of Jan. 2010 - Dec. 2014. First, monthly/annual price-to-income and monthly price-to-rent ratios are examined for the national Turkish as well as regional Istanbul, Izmir and Ankara housing markets. Second, an extended CASE and SHILLER (2003) model is applied assessing the interdependence between housing prices and a series of explanatory variables. Lastly, the Right Tail Augmented Dickey-Fuller (Rtadf) test is performed to support the overall analysis. This study finds that neither affordability ratios nor regression estimates support the existence of the bubble in Turkey.

Detection of price bubbles in Istanbul housing market using LSTM autoencoders: a district-based approach

“…In addition to the studies suggesting a price bubble in the Turkey housing market, there are also some analyses producing the opposite results. For example, Coskun and Jadevicius ( 2017 ) implemented three methodologies covering monthly/annual price-to-income and monthly price-to-rent analysis, Case–Shiller and extended Case–Shiller regressions and right tail augmented Dickey–Fuller test to investigate price bubbles in Istanbul, Ankara and Izmir housing markets over the period of 2010–2014. According to their analysis, there is no evidence to support the existence of a price bubble in the mentioned housing markets.…”

Determinantes urbanos del precio de la vivienda en Chile: una exploración estadística

“…Ante una desigualdad de negociación en economías de libre mercado, los precios de las propiedades dependerán en gran parte del liderazgo de clase que tomen actores rentistas con gran poder de compra transferido en patrimonio inmobiliario, lo que incluso será bien visto por el mercado como síntoma de rentabilidad, aunque esto merme el acceso a la vivienda de hogares con limitado poder de compra (Harvey, 1985). Una excelente manera de identificar la especulación en el mercado de la vivienda es midiendo la distancia entre precio y atributos fundamentales (Coskun y Jadevicius, 2017;Dreger y Zhang, 2013;Gil-Alana, Dettoni, Costamagna y Valenzuela, 2019). Estando Chile en una crisis del acceso a la vivienda (CNN Chile, 10 mayo 2019), reconocer cuan separado está su precio vivienda de sus variables fundamentales, requiere identificar los factores que determinan esa relación.…”

Analyzing Multiple Bubbles in the Usdkzt Exchange Rate Using the Gsadf Test

“…Studies investigating the price bubbles in housing markets using the GSADF test: Zeren and Erguzel (2015), Engsted et al (2016), Shi et al(2016), Escobari and Jafarinejad (2016), Coskun and Jadevicius (2017) Afsar and Dogan (2018), Evrim et al (2018), Hu and Oxley (2018), Iskenderoglu and Akdag (2019), Gokce and Guler (2020), Abioglu (2020).…”