Housing price down in Tehran

May 8, 2020 - 16:59

TEHRAN- According to a recent report released by the planning and economic affairs department of Iran’s Ministry of Transport and Urban Development, the housing price in Tehran city has dropped two percent in Farvardin, which is the first month of the Iranian calendar year (March 20-April 19).

The report put the average price of one square meter of a house at 155.4 million rials (about $3,700) at the capital city, which was two percent lower than the average price in the last month of the previous year, IRNA reported.

As previously reported, the number of real estate deals in Iran has dropped 52 percent in the first month of this year compared to the same month in the past year.

The number of deals has also fallen 70 percent to 1,250 in the capital city, Tehran, during the mentioned month.

The number of real estate deals in the country had fallen 70 percent in the last month of the past Iranian calendar year, Esfand (ended on March 19), which was the highest drop that this sector has experienced over the past three years, according to Hesam Oqbaei, the vice-chairman of Iranian Real Estate Agencies.

“Last year, when house prices experienced a 100-percent growth, rent prices rose by as much as 30 percent. Of course, this year we anticipate that rent growth will not reach inflation and will stay below the inflation rate,” according to Hesam Oqbaei, the deputy head of Tehran Real Estate Association.

The housing market is experiencing inflation and rise in prices, both in terms of rentals and sales, but the rise in prices is not going to be like the last year's sudden surge, he said on May 2.

According to the official, 37 percent of the country's urban population are tenants, who are from the low and middle classes of the society and their salary increase has been up to 22 percent, so if the rent prices were supposed to grow along with the house prices people won’t be able to afford it.

Noting that the government planned to provide financial facilities for the low-class tenants last year, Oqbaei said: "Now is the time to grant financial facilities, because the transfer season has begun and it is time for the government's last year’s proposal to become operational."

Oqbaei underlined the lack of balance in supply and demand as the main reason for the upward trend in housing prices and said since there are not enough bank facilities available to homebuyers, more people will stay as tenants and the demand for house rents increases, so consequently rent prices will also rise in areas where there is an imbalance between supply and demand.

MA/MA

Leave a Comment

1 + 1 =