Home Sales Grow in 9 Tehran Districts

EghtesadOnline: While the long-lasting stagnation in the Iranian housing sector prevailed in the first month of summer, which was expected to mark a turning point in the key sector, the number of home sales in nine districts of Tehran marked an improvement.

News ID: ۷۴۳۰۹۷

31 July 2017

According to the latest report of the Central Bank of Iran, which assesses different aspects of home sales in Tehran for the month ending July 22, the number of sales in nine districts of the city registered an increase ranging from 1-20%.

District 12 located in central parts of the city recorded the biggest jump in sales at 13% while districts 3 and 22 with an increase of 11% and 9% respectively were next in line.

However, the total number of home sales in Tehran during the month to July 22 stood at 14,500, marking a drop of 6.2% and 2.5% compared to the previous year and month respectively, Financial Tribune reported.

As cited in the report, District  in the northern part of the capital registered a tiny growth of 1% in the number of sales during the first month of summer and accounted for 16.5% of the entire home deals in Tehran to remain the hotspot of property market in the city.

Districts 4, 2 and 8 respectively owned 10.9%, 9.4% and 6.3% of all the home sales in Tehran. The aforementioned districts are also located in northern parts of the capital and their prices are higher than the city's average.

More than 42% of Tehran's home sales were in the aforementioned nine districts. The housing market in more expensive northern parts of the city is having better days compared to southern and central neighborhoods. Statistics indicate that the effective demand in housing market is in middle–higher income households.

Housing loans, which were aimed at pushing the housing market out of recession, have not been welcomed by weak and low-income groups since the monthly installments of the loans are as high as an apartment's rent and their allocation also requires the applicant to deposit a sum of money with the lending bank for a period of time, which many poor families can ill afford.

According to CBI's report, District 1 has remained the most expensive part of Tehran. The average price of 1 square meter of a residential unit in the high-end district stood at 97.4 million rials ($2,563) while the figure for an apartment in District 18–the cheapest area in the city–is less than 23 million rials ($605).

The average price of 1 square meter of a residential unit in Tehran by the end of the month to July 22 reached 46.2 million rials ($1,215), marking an annual increase of 6.2% and a monthly increase of 1.2%.

Analyzing the home sale records in recent years indicates that the long promised signs of a boom phase in the housing sector have yet to come.

A number of positive factors led many analysts to project the onset of a pre-boom phase in Tehran's housing market, but the number of home sales in Tehran has so far failed to uphold the claim.