TEHRAN - Bank Maskan, the state agent bank of the housing sector, paid 201.360 trillion rials (about $4.79 billion) of facilities in the first seven months of the current Iranian calendar year (March 20-October 21).

According to the bank’s Managing Director Mahmoud Shayan, the value of the loans paid during the mentioned period shows a 46-percent rise compared to the same period last year, despite the recession in the housing market.

The official noted that 1,135,235 loans were paid to the applicants in various forms, including home loans under housing saving account, housing bonds, housing repair bonds, or construction loans, IRNA reported.

Noting that at least 30 percent of all homebuyers used Bank Maskan loans to finance their houses during the period, the official said a total of 66,000 home purchase loans worth 66 trillion rials ($1.57 billion) were paid to applicants.

“A total of 84,366 housing repair bonds worth 28 trillion rials ($106 million) were paid. Most people opted for renovating their homes rather than buying a new one due to the exponential rise in home prices in Tehran and other big cities. That is why repair and reconstruction loans [housing repair bonds] outnumbered home loans paid by the bank,” he said.

In the housing construction sector, the total number of loans allocated to applicants reached 12,181 worth 33,510 billion rials (about $667 million) over the period under review.

The official added that during the seventh month of the current year (October 22-November 21), a total of 43,448 loans worth 27.693 trillion rials (about $659 million) were handed out to applicants, which indicates a 24 percent increase compared with the same month of last year.

Back in September, a member of the Iranian Parliament (Majlis) Civil Committee said that the drastic and unprecedented rise in housing prices in recent months was going to lead the housing market to a recession in the coming months.

“With the dramatic and unprecedented rise in housing prices, the market is expected to enter a recession for at least three to four years in the coming months, but naturally, as the recession intensifies, housing prices will fall by about 10 to 20 percent”, Mojtaba Yousefi stated.

Unfortunately, housing prices have risen by about 200 percent in recent months, and this has created many problems for real house buyers, he lamented.

“The main problem is that in such a market real buyers cannot afford to buy houses and instead the market has become a playground for brokers and speculators.”

According to the official, the housing market trend in Iran has been sinusoidal, meaning that housing prices have risen over a period of time and then the market has entered a recession, however, in the last two years the trend has become contrary to the previous years and the housing prices have been constantly increasing.

EF/MA