If interest rates decrease, will housing and vehicle prices also decrease?

After the Federal Reserve's interest rate cut decision, attention turned to the Central Bank of the Republic of Turkey. The interest rate decision, which is expected to affect many data in the markets, was evaluated by Kocaeli University Faculty Member Prof. Dr. Ferhat Pehlivanoğlu with presenter Abdurrahman Yazıcı on Haberler.com.

Prof. Dr. Ferhat Pehlivanoğlu noted that if the Central Bank cuts interest rates, significant changes could occur in the economy, and he continued his speech as follows:

The expectation is that the Central Bank will cut interest rates between 100 and 250 basis points. We had implemented a tight monetary policy, and our interest rates had reached 50 basis points. After relatively backward steps in inflation, there was a small relief margin for the Central Bank. Therefore, it is necessary for interest rates to decrease for both the producer sector and to reduce credit costs.

IF INTEREST RATES FALL, WILL HOUSING AND VEHICLE PRICES ALSO FALL?

This risk is in terms of demand increase. In cases where supply is insufficient, it may lead to price increases and create pressure on inflation. Since interest rates have fallen, the Turkish lira may have partially lost its attractiveness for foreigners. There may be an increase in exchange rates. This could raise import costs, which in turn could push inflation upwards.