At the beginning of the article, my intention was to examine the increase in housing prices. I would look at the role of construction costs in this increase, remind once again when prices have been on the rise and the reason for this, and I would also emphasize that the interest of the citizen in housing does not seem to be cut off unless he can find a place to evaluate his money. That was my intention.
Of course, I would do all this assuming that the data on the housing price increase I have is healthy.
While examining the data set on the change in housing prices announced by the Central Bank the previous day, I first thought that I had misunderstood some of the change rates. Well, the Central Bank was not going to make mistakes in the official data… I looked again; I wasn’t the one who got the rates wrong, it was written like that, it was written wrong. There was a strange logic error.
Let me explain what the Central Bank did:
Total housing price index for Turkey in general in June compared to a year ago 160.6 percent had increased. In the price of new houses 164.8 percentin the price of non-new housing 160 percent.There was an increase of 7.
Let’s ask; 164.8 with 160.7How is the average of 160.6 It’s Central Bank!
The source of this strangeness is the data on Istanbul. Housing prices in Istanbul annually in June 184.9 percent has increased. Rate of increase in new residences 208.7 percentrate of increase in non-new housing 186.1 percent dead. So the Central Bank 208.7 with 186.1the average of 184.9 calculate as success(!) showed.
Actually, it’s not surprising
Then I thought, the central bank’s error actions Among them, this does not occupy a very important place.
What did the Central Bank do before?
■ Is the amount related to the purchase and sale of government securities by non-residents in Turkey, for example 100 million dollars with one calculation method, 80 million dollars with another calculation method? The Central Bank made it happen, it did it! This has probably been recorded as the most common mistake the Central Bank could make. Those who want to read the details of this subject can take a look at my article dated November 20, 2015.
■ Two zeros were removed from the BIST index in 2020. For a study, I took a month’s average index from the Central Bank’s electronic data distribution system (EVDS), but it didn’t seem very realistic to me. Then I realized that the Central Bank had taken the index into account for a period of that month at the old level, then zero; He added the zero and zero indices and divided them by the number of days. Of course, that’s why the average index was so high. I moved this issue to my corner, the Central Bank was not even there. Then on 14 September 2020 this time “The Central Bank liked this mistake very much, it does not dare to correct it” When I wrote it again with the title, it was finally corrected.
■ Dollar If it goes from 5 liras to 10 liras, it gains 100 percent value against TL. However, TL does not depreciate 100 percent against the dollar, this is a very common mistake especially in spoken language. According to these values, TL depreciated by 50 percent against the dollar. No money loses 100 percent of its value anyway, then there is no money left. Well, if the Central Bank makes such a calculation error… Don’t say “Is it okay”, it’s done! Since the Central Bank could not meet its 2020 inflation target, he wrote that classic letter to the then Minister of Treasury and Finance, Lütfü Elvan. Here in that letter, the value change of TL is calculated as I stated in the entry. As I explained in detail in my column on February 9, 2021, the Central Bank writes the depreciation of TL as 25 percent in its letter; but the actual loss rate is 20 percent. For a while, there were sensitive managers in the Central Bank who would admit the mistake and say that it would not be repeated, and this issue was just closed.
These are the errors that I can remember in the short span of time yesterday. I’m sure there are others. But that’s enough!
What was I going to write, where did I get thrown!
As I said at the entrance, when I turned on my computer, my intention was to write very different things. But when I saw one of the Central Bank’s routine mistakes, I took a short trip back in time.
Do not let the graphic I prepared for my article go to waste, I would like to present it to your information. You can see the change in the increase in housing prices and the increase in construction costs in the last year and a half. Of course, I accept the 160.6 percent announced by the Central Bank as the last one-year rate of increase in housing prices in this chart. In fact, if this ratio is correct, other ratios are incorrect, and if other ratios are correct, this ratio is incorrect!