Farshid Pourhajat, the Secretary of the National Association of Mass Builders of Iran, stated that the “minimum cost” of housing construction in Tehran, considering land prices and excluding ancillary costs such as permits, is at least 680 million rials (approximately $1,134) per square meter.
On Thursday, August 22, Pourhajat told the Entekhab website that the inability of the middle and lower classes to purchase homes was evident from the beginning of this year (March 21) due to “the continued inflation in housing.”
The Real Estate Consultants’ Union had also predicted in March of this year that with the rise in the dollar exchange rate, there is a likelihood of repeating the experience of stagflation in the housing market this year.
Pourhajat, dismissing the government’s “fabricated statistics” as unrealistic, stated that the real data corresponds to the actual market prices. He explained, “In Tehran, the average price has risen above 800 million rials (approximately $1,334), and in smaller cities, you can’t find a house for less than 40 billion rials (approximately $66,667).”
He mentioned that the minimum cost of housing construction, excluding land prices and other expenses such as permits, risk costs, and processes, is 180 million rials (approximately $300) per square meter.
According to the Secretary of the National Association of Mass Builders, land prices in Tehran are currently not less than 500 million rials (approximately $834) per square meter.
On July 29, the ISNA news agency reported that “the price of housing in the capital has reached 860 million rials (approximately $1,434) per square meter.” The report stated, “Since December 2017, housing prices in Tehran have increased by 1,590%, rising from an average of 50.9 million rials to 859 million rials.”
In mid-September last year, Hamshahri newspaper, the official news outlet of the Tehran Municipality, confirmed the recession in the housing and construction sector in a report, stating that the housing market entered one of its hardest recessions after the unreasonable price surge in the winter of 2022.
The report pointed to the decline in cash flow in the housing market and the inability of some mass builders to continue construction, emphasizing that the halt in cash injections from the banking system is one of the factors contributing to the recession in construction.
In his interview with Entekhab, Pourhajat emphasized that the production ceiling is “below 400,000 units per year.”
According to him, statistics for the first two months of the year have not been fully extracted, but field surveys indicate a “decrease in production compared to last year.”
On April 29 of this year, Baitollah Sattarian, a housing expert, stated in an interview that Iran needs one million housing units annually, but only 200,000 homes are being built.
Ebrahim Raisi, the president of the fourteenth government, had promised during his election campaign to build one million housing units annually.
However, Masoud Pezeshkian, the fourteenth president, during his election debates, emphasized that “it is not possible to build one million housing units per year” and without providing further details, said, “I will implement whatever is legally possible and within my capacity.”
In mid-October 2023, after eight months of withholding and censoring data, the Statistical Centre of Iran reported a record annual housing inflation rate of 84% in the capital in October.
A look at rental prices reveals that, contrary to the claims of Iranian regime officials, rents have increased by an average of 130% in Tehran and other cities.
Currently, rent has become one of the most significant economic concerns for Iranians.
