54% Increase in Housing Prices Since Last Year and 2% Decrease from Last Month; Experts Say It's 'Temporary'

On Sunday, December 24, the Central Bank published a report on the housing market developments in Tehran for the month of Azar 1402, stating that the average housing price has decreased by 2.2%, dropping from approximately 76 million tomans to 74 million tomans. However, compared to the same time last year, the average housing price has increased by 54.1%. This preliminary report indicates that the volume of housing transactions has also decreased by 1.2% in line with the price drop. The Iran Watch website, citing the Central Bank's preliminary report, explained that the number of transactions fell from about 4,000 in Aban to 3,550 in Azar. Housing transactions are also 65.1% lower than in Azar of the previous year. According to experts, the decrease in housing prices, which the thirteenth government considers one of its achievements, is a result of the economic recession, primarily caused by government institutions themselves. Experts say the trend of decreasing prices is not sustainable, and as soon as transactions resume in the market, housing prices will return to their previous path. For instance, in Aban, when the number of transactions showed a relative increase compared to Shahrivar 1402, prices also began to rise. Mansour Ghaibi, a housing expert, stated that the government only believes it has controlled prices, telling Tejarat News: 'This is a spring that is being compressed, and with any excuse that may arise in the future, not only will prices increase, but the number of transactions will also rise dramatically.' Ghaibi commented on the future of the housing market, saying that given the government's two upcoming elections this year, it will try to keep the housing market stable. He predicted that as the new year approaches, housing transfers will again lead to price changes. On the other hand, in line with the housing construction crisis, Iranian media previously reported, based on official statistics, that this year’s rental contracts have seen a 55% increase compared to last year, which is more than double the 'historical average of this rate.' The macroeconomic policies of the Islamic Republic in the housing sector over the past four decades have led various segments of society, including buyers, sellers, and real estate consultants, to face serious challenges. The recession in housing transactions has forced real estate consultants to become internet taxi drivers. A newspaper claimed that the government's incorrect statistics are the cause of a 'tsunami' in the housing market. The repercussions of passing unstudied laws include a reduction in construction workers' insurance premiums; members of parliament have requested an 'interpretation.' A comparison of housing prices in Iran and Turkey shows that homes in Istanbul are cheaper than in Tehran. An economic expert stated that the monthly income of the middle class is decreasing.