Official statistics in Iran indicate that housing prices in Tehran have risen sevenfold since 2017. Despite promises to fight inflation, drop the prices, and build four million homes, according to the Central Bank of Iran, housing prices in Iran have soared sharply since Ebrahim Raisi took over the government.
The price of each square meter of land in Tehran has increased from 300 million rials in August 2021 to over 350 million rials in March 2022. This represents an increase of 50 million rials per square meter of land in Tehran in nearly seven months, while the price of each meter of land from 2017 from 50 million to 350 million rials in 2021 shows a sharp upturn by 600%.
Another reason for the dramatic increase in housing prices has been the sharp drop of the state currency in recent years and months. The value of the US dollar vs. Iranian Rial increased 15% in one year, which has had an immediate impact on housing prices like other basic goods and services.
Another reason for the increase in housing prices is the problem of vacant houses. In recent years, reports suggested that about 2 million vacant houses in Iran, are mainly owned by the country’s major banks and state-affiliated holdings that keep housing prices high.
Another cause of the increase in housing prices was the stock market effect, designed by the Hassan Rouhani administration in 2020 which created a bubble in the Tehran Stock Exchange by manipulating the trends which kept housing prices high despite the decrease in demand.
The change has not gone unnoticed by the state media and many outlets confirmed the stats.
On April 26, according to Eqtesadnews, Mehdi Ravanshadnia, a housing market expert, said, “Given the inflation in the housing market, and on the other hand, the lack of construction of new rental houses, good conditions for tenants are not predicted in the year ahead and rentals are expected to become more expensive.”
Ravanshadnia continued: “The prediction for the rental market this year is that inflation will be the same level as last year. The reason why there is an increase in inflation in the rental market is that in order to compensate for the ratio of the purchase price to the rental price, we will see that prices have an upward trend.”
Another publication revealed how this will have a domino effect in other smaller cities and counties.
“The city of Pardis (35 kilometers east of Tehran) has hosted many people who have not been able to buy a house in the capital since 2019 due to the surge in prices in Tehran,” the state-run Bazarebours wrote on April 25. “These conditions have caused prices to rise in Pardis as well.”
The executive director of the Mashhad Real Estate Advisors Union, Hossein Rostami, told the Javan news agency: “Rent in Mashhad in January and February increased by about 50%. Rents have not yet increased in March and April, but they may increase after Ramadan. It is possible that after Ramadan we might see some people moving out. Not many people can afford to move away and therefore they usually get along with the landlord or they migrate to the outskirts of the city.”
According to IRNA, “the relocation of people to the outskirts of major cities is referred to as the silent disease of today’s metropolises. It is a byproduct of migration, economic hardships, and the centralization of the population, especially in the capital. This means that the migration process leads to the evacuation of villages and the reduction in the population of low-income cities, and finally, the population is concentrated in several large cities or provinces, and the process of polarization of the country begins.”
Source » ncr-iran