Capital Compass – 2024 Outlook for the Housing Sector | Dr. Ziya Yılmaz

On this week’s episode of “Capital Compass,” we welcomed Dr. Ziya Yılmaz, Chairman of the Board of Directors at DAP Holding and one of the leading figures in the construction industry. We had an in-depth conversation with Dr. Yılmaz about the current state of the housing sector, expectations for 2024, and the challenges facing the industry.

DAP Holding and Healthy Home Projects

Dr. Ziya Yılmaz began his remarks by highlighting DAP Holding’s 43-year history and its expertise in residential development. He noted that the company carries out projects in various regions of Turkey and aims to enhance the country’s image through these initiatives. He explained that, based on surveys conducted particularly during the pandemic, they developed healthy housing projects tailored to people’s needs, and that these projects have garnered significant interest. The Ormanköy project, launched in Çekmeköy, stands out as a key example in this regard. Yılmaz noted that they now take care to build homes with balconies, terraces, and ample green spaces in all their projects.

Benefits of an Initial Public Offering

Sharing his experiences regarding DAP Holding’s initial public offering (IPO) in 2022, Dr. Yılmaz discussed the benefits this process brought to the company. He noted that the IPO strengthened the company’s financing and helped it adopt a more institutional and transparent structure. Noting that going public provides companies with significant benefits in terms of long-term growth and sustainability, Yılmaz recommended that all companies that have reached a certain size go public.

2024 Outlook for the Housing Sector

Noting that the housing sector had experienced a challenging year, Dr. Yılmaz stated that sales had declined in 2023 due to a drop in consumer purchasing power and that older homes were being preferred. However, he noted that his expectations for 2024 were positive and that he anticipated an increase in demand for new homes in particular. Drawing attention to earthquake risk, Yılmaz emphasized the need to demolish older buildings and replace them with new, earthquake-resistant structures. He also noted the importance of incentivizing new housing projects and providing accessible mortgage options.

Financing and Credit Options

Dr. Yılmaz, highlighting the importance of financing in the housing sector, emphasized that high interest rates are negatively affecting the sector but that the government needs to take steps to encourage new housing construction. He noted, in particular, that positive discrimination should be applied for new homes. Yılmaz stated that DAP Holding has developed various financing models and is working to offer suitable loan options.

Real Estate Investment and High-Quality Housing

Responding to the question of when the right time is to invest in real estate, Dr. Yılmaz noted that rising commodity prices would also drive up new housing prices. For this reason, he advised consumers to purchase homes from projects they like as soon as their purchasing power allows. He emphasized that real estate appreciates in value over the long term and is a safe investment vehicle. He also touched on the importance of high-quality housing production, noting that projects must be developed to meet future needs, be earthquake-resistant, and meet modern living standards.