The Gold Channel: How Regional Gold Saving Behavior Shapes House Price Dynamics in Türkiye

Households in many emerging economies hold substantial alternative assets such as gold and cryptocurrencies, yet macro effects from these assets are difficult to explore due to measurement challenges. Exploiting Türkiye’s cross-provincial heterogeneity in gold saving and the exogenous 2023-2025 global gold rally, we study how gold wealth transmits to the housing market. Using a province-level administrative dataset within a novel approach to proxy the formal and informal gold tendency and a difference-in-differences (DID) design, we show that house prices rise significantly more in high-gold provinces, with an average 10% cumulative additional price increase due to the wealth effects from gold. Mechanism tests indicate a liquidity channel: the cash-purchase share increases, while credit-financed transactions do not. At the same time, secondary market sales fall, consistent with strengthened homeowner balance sheets tightening resale supply. A Bartik-style instrumental variable (IV) strategy based on passive gains supports causality. The findings highlight that alternative saving instruments can fuel real asset inflation through cash, suggesting that monetary and macroprudential policy frameworks focused solely on credit flows may miss important pressures in inflationary environments.