Explosive behavior in the real estate market of Turkey

The aim of this paper is to investigate the potential presence of explosive behavior in the real estate market of Turkey. We apply the methodology developed by Chen et al. (2017) for co-moving systems with explosive processes on the monthly housing price indices and the housing unit prices over the period January 2010–December 2017. The empirical results indicate the existence of explosive behavior in the nationwide price index as well as the regional price indices. Upon analyzing the relationship between nationwide price index and regional price indices, some regions are found to have more aggressive real estate markets than the whole market.