Everyone considering a mortgage to buy a home is asking the same questions: Will interest rates fall? When will the low-interest First Home loan program begin? Are “prepaid-interest” or “payment-free period” mortgages really advantageous? It is no coincidence that Google searches for these questions have surged over the past three months.
In this guide, we explain where mortgage rates stand as of October 2026, what has and has not yet been confirmed regarding the First Home loan program, and the real cost of new financing models with sample calculations.
What are mortgage rates like in October 2026?
As of early October, monthly rates for 120-month housing loans range approximately between 2.87% and 3.25%. According to press compilations dated 2–3 October, some of the leading rates are as follows:
| Bank | Monthly Rate (120 Months) |
|---|---|
| Kuveyt Türk | 2.87% |
| Türkiye Finans | 2.88% |
| Ziraat Bankası | 2.89% |
| Albaraka Türk | 2.90% |
| Vakıf Katılım | 2.94% |
| Halkbank | 2.99% |
| QNB | 2.99% |
| Akbank | 3.15% |
| TEB | 3.20% |
| Garanti BBVA | 3.24% |
These rates vary from person to person depending on promotional campaigns, credit score, income level, and banking history. Across the sector, the average annual interest rate on Turkish lira housing loans stood at around 41.87% in the first week of October.
Let us put the figures into perspective: For a TRY 2 million loan over 120 months, at a monthly rate of 2.89%, the monthly instalment is approximately TRY 59,757, while the total repayment reaches roughly TRY 7.17 million.
If the same loan is taken at 3.15%, the monthly instalment rises to approximately TRY 64,562, and the total repayment reaches about TRY 7.75 million.
In other words, a difference of just 0.26 percentage points between banks results in a difference of approximately TRY 577,000 over the full term. This is why relying on an offer from only one bank may not be sufficient.
Where are interest rates heading? All eyes on 22 October
The Central Bank is expected to announce its interest rate decision on Thursday, 22 October. Most economists participating in CNBC-e’s survey expect the policy rate to be reduced from 37% to 36%. The year-end expectation is around 35%.
Policy rate cuts generally feed through to mortgage rates gradually and with a delay.
The decline in inflation to 29.73% in September supports expectations for a limited decline in loan rates in the coming months. However, delaying a purchase solely in anticipation of lower rates may not always be the right strategy. Housing prices may also rise, and a small reduction in interest costs could be offset by an increase in the property price.
The market is also becoming more active. According to TÜİK data, mortgaged home sales increased by 5.1% year-on-year to 23,397 in September 2026. Between January and September, the increase reached 24.7%. First-hand home sales also rose by 3.9% year-on-year to 51,519.
In Antalya, 6,704 homes were sold in September, representing an increase of approximately 14.5% compared with the previous month.
First Home Mortgage Program: What is known and what remains uncertain?
One of the most searched mortgage topics in recent weeks has been the First Home loan program, discussed with a monthly interest rate of 1.20%.
However, as of 14 October, no official application calendar, participating bank list, or final eligibility criteria had been announced.
Information reported in the media includes:
- Who may qualify: First-time homebuyers are expected to be prioritised. Applicants without a property registered in their own name are likely to be the main target group. Income limits and maximum property value thresholds have not yet been announced.
- Interest and maturity: A monthly rate of 1.20% and a 120-month term are being discussed, but these have not been officially confirmed.
- Banks: Ziraat Bankası, Halkbank and VakıfBank are expected to participate.
- Support model: A proposal on the parliamentary agenda envisages the Treasury covering part of the profit-share cost in housing finance.
If the discussed rate becomes official, the difference would be significant. A TRY 2 million loan at 1.20% monthly interest would result in a monthly instalment of approximately TRY 31,536 and a total repayment of about TRY 3.78 million.
That is almost half the approximately TRY 7.17 million total repayment under current market conditions.
For this reason, those planning to buy their first home may find it sensible to follow official announcements closely and prepare the required documents in advance.
However, be cautious about websites on social media requesting money under the name of “pre-application.” Official applications are made only through banks and e-Devlet.
Prepaid-interest and payment-free mortgages: What is the real cost?
Two other financing models are also attracting attention. Both may appear appealing, but if they are not calculated correctly, they can become expensive.
Prepaid-interest housing loan
Under this model, you pay part of the loan interest upfront when taking out the mortgage, and in return the bank reduces the monthly interest rate.
For example, hypothetically, if the monthly rate on a TRY 2 million loan drops from 2.89% to 2.59%, the monthly instalment would fall from TRY 59,757 to TRY 54,326, creating savings of approximately TRY 650,000 over 120 months.
In this case, the decision is relatively straightforward: if the upfront payment is significantly lower than TRY 650,000, the model may be advantageous.
However, you should also consider the potential return you could earn by keeping that upfront amount in a deposit account or another financial instrument.
Always request a full total-cost schedule from your bank.
Housing loan with a payment-free period
Models that allow borrowers to defer instalments for the first few years are particularly popular for projects with long delivery periods.
However, interest continues to accrue during the payment-free period.
As a hypothetical example, if a TRY 2 million loan at 2.89% monthly interest remains unpaid for 36 months, the outstanding balance would rise to approximately TRY 5.58 million.
If that balance is then repaid over the remaining 84 months, the monthly instalment would be approximately TRY 177,000.
If you are considering this model, do not sign anything before seeing in writing exactly how interest accrues during the payment-free period and what the later instalment schedule will look like.
Rules that determine the maximum loan amount
The amount a bank can lend is determined not only by your income but also by BDDK loan-to-value regulations.
Following the March 2026 regulation, higher loan-to-value ratios apply to first-time homebuyers, while lower ratios apply to people who already own more than one residential property.
Homes constructed after 2010 and holding at least a Class C energy rating may also qualify for more favourable ratios.
Because the exact ratio varies according to the value of the property, buyers should also consider the risk that the appraisal value may come in below the agreed purchase price.
5 checks before taking out a housing loan
- Obtain offers from at least three banks. Include participation banks in your comparison.
- Look at the total cost. Include allocation fees, appraisal costs, compulsory earthquake insurance (DASK), home insurance, and life insurance.
- Calculate the instalment-to-income ratio. Keeping monthly instalments below roughly one-third of household income is generally considered a healthier limit.
- Plan for appraisal risk. If the appraisal comes in below the sale price, you will need to cover the difference with additional cash.
- Understand early repayment conditions. If interest rates fall, you may want to refinance or close the loan early. Know the costs in advance.
Frequently Asked Questions
Which bank offers the lowest mortgage rate in October 2026?
According to early-October compilations, the lowest rates were around 2.87%–2.90% at Kuveyt Türk, Türkiye Finans, Ziraat Bankası and Albaraka Türk.
Rates change frequently, so always obtain a current offer directly from the bank before applying.
Have applications for the First Home loan started?
No. As of 14 October 2026, the official application date, eligibility conditions and participating banks had not yet been announced.
If the policy rate is cut, will mortgage rates fall immediately?
Usually not. Banks generally reflect policy-rate cuts in their pricing gradually and over several weeks.
Is a payment-free mortgage a good idea?
It may ease cash flow if you are paying rent while waiting for a project to be completed. However, interest accrued during the payment-free period can significantly increase the total debt.
Always request the full repayment schedule before making a decision.
Conclusion
Mortgage rates remain high in October 2026, but the direction is downward. The biggest difference will come from choosing the right bank, calculating the full cost correctly, and closely following supported financing models such as the First Home program.
If you are considering buying a property with mortgage financing in Antalya, Grand Emlak can support you from selecting a property that fits your budget through to the appraisal process.
This article is based on data reported in the media as of 16 October 2026 and does not constitute investment advice. Credit conditions vary by individual and bank. Contact your bank for definitive information.
