After two decades of working in the United States as an executive in top firms such as Goldman Sachs and First Republic Bank, Hafize Gaye Erkan states that the Istanbul's brutal property market left her no choice but to move back with her parents at the age of 44.
"We haven't found a home in Istanbul. It's terribly expensive, we've moved in with my parents. Is it possible that Istanbul has gotten more expensive than Manhattan?" says Erkan, told the Hurriyet Newspaper. As a result of Erdogan's unorthodox policy on interest rates, inflation went haywire and housing prices almost doubled.The severe housing supply shortage combined with high inflation created conflict between landlords and tenants. Ironically many people including Erkan, struggle finding lodgings. Following the elections, President Erdogan pivoted back to orthodox economic policies promising citizens to bring inflation rates back down with a team of former Wall Street bankers. Tight monetary policy started to have effects on consumer prices and year on year inflation stood at 61% in November. Erkan emphasized that single digit inflation would not be achieved before 2026 while calling on foreigners to invest in lira denominated government bonds at favorable returns.
Short term interest rates held below the inflation rates keep increasing housing prices drastically though “We’re nearing the end of our monetary tightening measures." says Erkan.
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