Mehmet Şimşek announces: A new era begins in housing!

Minister of Treasury and Finance Mehmet Şimşek stated that they have reached the final stage in the new regulation, which will be an important instrument for financing urban transformation and increasing housing supply, saying, "With the regulation to be made by the Capital Markets Board (SPK), the way will be paved for real estate investment funds to invest in real estate projects."

Şimşek made statements regarding the new initiative that will enable urban transformation and an increase in housing supply.

Reporting that the final stage has been reached in the regulation regarding the establishment of Project Real Estate Investment Funds (Project REIF) prepared by the SPK, Şimşek said, "With the regulation to be made by the Board, the way will be paved for real estate investment funds (REIFs) to invest in real estate projects. With the regulation, the portfolios of these funds will be made suitable and a type change will be carried out. With the increase in housing supply, the upward market pressure on housing prices will decrease, and thus accessibility to housing will become easier for all segments."

Pointing out that real estate investment funds could not invest in these projects or undertake the construction work of real estate before the new regulation, Şimşek said that these restrictions will be removed with the SPK's regulation.

Stating that real estate investment funds will now be able to invest in projects developed by themselves or others, Şimşek used the expression, "Thus, project real estate investment funds will be able to include land and real estate projects on which projects will be developed in their portfolios. These investment funds, which meet the conditions that will be included in detail in the regulation, will include the term 'project' in their titles and will be referred to as 'project real estate investment funds'. In these respects, project real estate investment funds will have a different content from existing real estate investment funds that cannot include projects in their portfolios."

INCOME FOR THOSE WHO WANT IT, A HOME FOR THOSE WHO WANT IT

Minister Şimşek stated that the project to be implemented by the SPK introduces a collateral mechanism in order to reduce the project-related risks of investors, and thus the fund will also keep the rights arising from revenue-sharing contracts under guarantee, and made the assessment, "This regulation will also provide investors with the right to exit the fund in case of changes that may affect the investment decision regarding fund activities, and thus investor grievances will be prevented."

Stating that investors can earn income from the sale or rent of the real estate at the end of the project, or have the opportunity to become a homeowner by making an in-kind exit, Şimşek shared the following information regarding real estate investment funds:

"There are 184 real estate investment funds whose issuance certificates have been approved by the SPK. While there are 149 funds that have already formed their portfolios, the portfolio size of these funds is around 82.7 billion liras. With the new regulation, the number of these funds is also expected to increase. Thanks to the collateral-based robust structure of the funds, real estate project production will be able to be realized with confidence. In this environment of trust, investors will be able to own homes by evaluating their small savings with a cooperative logic."

"IT WILL CONTRIBUTE TO PRICES ENTERING A DOWNWARD TREND"

Drawing attention to the fact that an increase in the general tendency to save in society is expected with the regulation, Şimşek noted the following:

"The regulation will be an important instrument in the financing of urban transformation and in increasing the housing supply. These investment funds will increase supply mobility in the housing market, both with the projects they will develop and with the independent housing units they can purchase from other projects, and thus they will be able to make a very large contribution to prices entering a downward trend. This revitalization will spread to the housing market as a whole. The regulation will also create a very valuable alternative for housing producers to obtain the financing they need from capital markets. Thus, savers will be able to evaluate their small savings in real estate projects."

News Source: AA