Interest Rate Expectations Shift Buyer Behaviour in Istanbul's Property Market

Istanbul's property market is experiencing a significant shift in buyer behaviour as interest rate expectations continue to rise, with many opting for shorter-term mortgages and more affordable neighbourhoods.

This shift matters now because the Turkish economy is closely tied to global economic trends, and the recent surge in interest rates is having a ripple effect on the local property market. With the average price per square meter in Istanbul standing at USD 2.5k, buyers are becoming increasingly cautious and seeking out more affordable options. The citizenship by investment program, which has driven foreign demand in recent years, is also being impacted by the changing interest rate landscape.

In neighbourhoods like Besiktas and Beyoglu, traditionally considered premium areas, buyers are now looking to Sisli and Kadikoy on the Asian side as more affordable alternatives. The Sisli municipality's efforts to revitalize the area, including the redevelopment of the Bomonti district, are also attracting buyers. Meanwhile, the Kadikoy municipality's focus on improving infrastructure, including the expansion of the Kadikoy-Moda tramline, is making the area more appealing to those looking for a more affordable option without sacrificing amenities.

Market Data and Trends

According to data from the Istanbul Real Estate Agents Association, the average mortgage term in Istanbul has decreased by 12% in the past quarter, with many buyers opting for shorter-term mortgages to mitigate the impact of rising interest rates. Additionally, prices in Sisli have increased by 8% in the past year, while prices in Kadikoy have risen by 5%, making them more attractive to buyers looking for affordable options. As of June 2026, the average price per square meter in Sisli stands at USD 2.2k, while in Kadikoy it is USD 1.8k.

As the interest rate landscape continues to evolve, buyers would be wise to carefully consider their options and seek out professional advice before making a purchase. With the right guidance, buyers can navigate the changing market and find opportunities that meet their needs and budget. The Istanbul property market is known for its resilience, and with the right strategy, buyers can still find value in neighbourhoods like Sisli and Kadikoy, which offer a unique blend of affordability and amenities.