Mortgage and the application of Turkey

The industry of real estate is very important for a country economics. Thedevelopment of real estate industry is deal with other industries developmentdirectly. Therefore, the growth of this industry affects the whole economy in acountry.The real estates are used for dwelling rather than saving and investmentin Turkey. The more per capita gross domestic product increases, the more realestates are built. Investments in real estate industries are not enough fordevelopment of this sector in Turkey. An increase in the country population andurbanization rates affects the investments in real estate. Thus, to standardizeincreasing demand for real estate different methods are applied. The system asknown mortgage in foreign economies, unfortunately up to day has not beenapplied in Turkey. Because of the fact that the economy of Turkey has beenunstable and, inflation and interest rates are very high. Recently inflation andinterest rates have been decreasing, therefore the mortgage system is onconclusion. The background of the mortgage system has been prepared by theCapital Market Board (CMB), Grand National Assembly (GNA) and Ministry ofFinance (MF) and, the model was gone to GNA as a bill.In this study, we investigate the approval of the mortgage system to thestructure of Turkey. The model was determined as appropriate for our countries?structure. For this reason the mortgage system should be applied after someimprovements in Turkey. Also in this study we compare the applying mortgagesystems in European Union and United States. Than, we determined which oneis being applied in our country and which one is suitable for Turkish economy. Inconclusion, this study focused on the model of the Turkey and determined thepositive and negative sides of the model.