TÜİK says construction costs rose 28.33% year on year in July. In Q2, flats granted building permits fell 9.5% while flats granted occupancy permits rose 10.7%.
The Turkish Statistical Institute's (TÜİK) latest two construction releases show the cost side and the project side of new housing supply together. According to data released on 9 September, the construction cost index rose 28.33% year on year and 1.15% month on month in July. Building permit statistics published in August showed that new permits declined in the second quarter of 2026.
Labour stands out in costs
- Materials index: 1.28% monthly, 27.13% annual
- Labour index: 0.92% monthly, 30.51% annual
- Building construction: 1.08% monthly, 28.37% annual
- Non-building structures: 1.38% monthly, 28.19% annual
In building construction, the cost of materials rose 27.34% and the cost of labour 30.19% year on year. Labour thus continued to rise faster than materials on an annual basis.
Permits down, occupancy permits up
According to TÜİK's April-June 2026 building permit statistics, compared with the same quarter of the previous year:
- The number of buildings granted a building permit fell 2.0%, the number of flats 9.5% and the floor area 7.4%.
- The number of buildings granted an occupancy permit rose 13.7%, the number of flats 10.7% and the floor area 5.8%.
Residential buildings with two or more flats made up 71.1% of the permitted floor area, or 37.6 million square metres. In the floor area granted occupancy permits, this share was 67.9%. By floor area, 78.2% of permits were issued by municipalities.
What does it mean for the market?
The rise in flats receiving occupancy permits shows that the supply of completed new homes is increasing in the short term. On the other hand, the drop in new permits points to a possible decline in the number of projects that will start in the coming period. The 28% annual rise in costs directly affects contractors' pricing of new projects.
For buyers: While options rise among completed homes with occupancy permits, in off-plan purchases the delivery date and the price-adjustment clauses in the contract should be examined more carefully.
For landowners: In build-for-share agreements, the sharing ratios can become a subject of renegotiation as construction costs rise. In areas such as Edremit, Akçay and Altınoluk, it is useful to know the current cost data before these talks.
Limits of the data
The construction cost index measures changes in material and labour inputs; it does not cover land cost, the contractor's profit or taxes. It should therefore not be compared one to one with the home sale price. Building permit statistics, in turn, show the number of permits and occupancy certificates; it does not mean that every project that gets a permit will start or be completed in the same period. Even so, the two sets of data together give an idea of the direction of new housing supply.
In calendar-adjusted data too, the number of buildings granted a permit fell 5.1% year on year. This shows that the decline is not caused only by the difference in working days.
Among non-residential uses in permitted floor area, industrial buildings and warehouses stood out with 4.5 million square metres.
