Modelling the Housing Price Index Using Machine Learning

Banu Has and Deniz Hacısüleyman

World Economics, 2026, vol. 27, issue 3, 183-222

Abstract: The article examines how exchange rates, housing loan interest rates, and CDS-based country risk perception shape Trkiye's housing price dynamics. The authors argue that housing prices in Trkiye cannot be explained only by the conventional interest rate-demand mechanism. Using an artificial neural network model, the study finds that the nominal exchange rate has the strongest model-implied contribution, followed by CDS and housing loan interest rates. The findings show that exchange rate and CDS increases are associated with upward housing price responses, while higher loan interest rates have a downward effect. The article concludes that housing in Trkiye increasingly functions as a store of value and inflation hedge.

Date: 2026
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