Bank Maskan Loans Surge by 46% to $767m in 7 Months

EghtesadOnline: Bank Maskan, the state agent bank of the housing sector, paid 201,360 billion rials ($767 million) in loans during the first seven months of the current fiscal year (March 20-Oct. 21).

News ID: ۷۵۱۵۳۱

19 November 2020

According to Mahmoud Shayan, Bank Maskan’s managing director, the value of loans furnished during the period shows a 46% rise compared with the corresponding period of last year, despite the recession in the housing market.

“The facilities were doled out in various forms, including home loans under Housing Savings Account, housing bonds, housing repair bonds, or construction loans. Bank Maskan loans to home buyers and builders as well as those willing to repair their homes topped 1.13 million counts over the period,” he said.

Noting that at least 30% of all homebuyers used Bank Maskan loans to finance their homes during the period, the official said a total of 66,000 home purchase loans worth 66,000 billion rials ($251 million) were paid to applicants.

“A total of 84,366 housing repair bonds worth 28,000 billion 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 was quoted as saying by Mehr News Agency.

In the housing construction sector, the total number of loans allocated to applicants reached 12,181 worth 33,510 billion rials ($127 million) over the period under review.

The official added that during the seventh months, a total of 43,448 loans worth 27,693 billion rials ($105 million) were handed out to applicants, which indicate a 24% increase compared with the same month of last year.

Tehran Housing Inflation Jumps Above 100%

The Central Bank of Iran's latest report on Tehran's housing market shows year-on-year inflation in the sector has exceeded by 100% in the capital city.

According to CBI, the average price of each square meter of a residential property in Tehran stood at 267.2 million rials ($1,017) during the seventh month of the current fiscal year (Sept. 22-Oct. 21), showing a surge of 110.1% over last year’s same month.

The YOY inflation of the housing sector last surpassed 100% in the month ending June 21, 2019.

Home prices in the capital city increased by 10% compared to 242.88 million rials ($925) in the sixth month of the current year.

A total of 8,656 homes were sold in Tehran during the seventh month of the current fiscal year, registering a 2.3% increase compared with the preceding month and a 154.5% growth compared with the same month of last year.

The CBI data show that during the month ending Oct. 21, newly-built residential properties up to five years old constituted the highest proportion of deals at 37% (or 3,205 deals), down by 4.9 percentage points compared with the same month of last year.

That lost share was added to homes above 11 years. Homes with a lifespan of 11 to 15 years, 16 to 20 years and above 20 years accounted for 13%, 19% and 12.8% of total deals compared with the same month of last year’s 12.6%, 15.3% and 10.5%, respectively.

The share of deals involving homes that were six to 10 years old decreased from 19.6% of the total deals of last year’s same month to 18.2% this year.

The distribution of dealt properties shows that among Tehran’s 22 districts, District 5 grabbed the highest share of total deals at 14.7%. It was followed by districts 10 and two with a share of 9.4% and 8.4%, respectively.

All-in-all, 10 districts (five, 10, two, four, 14, seven, one, eight, 15, and 11) grabbed the lion's share of the deals at 73.4% with the remaining 12 districts holding a 26.6% share.

Among Tehran's 22 districts, District 1 registered the highest average home price of 568.7 million rials ($2,166) per square meter. District 18 offered the capital city's cheapest homes with an average per-square meter price of 124.3 million rials ($473). The aforesaid numbers show a respective increase of 110.9% and 125.1% YOY.

Residential units with an average price range of 160 million rials ($609) to 180 million rials ($685) per square meter were highest in demand in Tehran during the Iranian month under review, as they grabbed an 8.2% share of all deals. They were followed by units priced at 140 million rials ($533) to 160 million rials per square meter with a share of 7.9% and homes priced at 120 million rials ($457) to 140 million rials per square meter had a share of 7.6%.

From the total number of deals, 58.3% belonged to homes cheaper than the average per-square meter price of the city (i.e., 267.2 million rials or $1,017).

Residential units with a floor area of 50-60 square meters registered the highest number of sales with a 14.7% share of total deals.

Units with an area of 60-70 square meters and 70-80 square meters came second and third with shares of 14.3% and 11.4%, respectively. All-in-all, residential properties with an area of less than 80 square meters had a 54.5% share of total deals.

CBI data further show that homes worth 6 billion rials ($22,857) to 8.5 billion rials ($32,380) were the most popular with a 13% share of total deals. These were followed by homes with a price tag of between 8.5 billion rials and 11 billion rials ($41,904) and those priced at between 11 billion rials and 13.5 billion rials ($51,428) had a share of 11.2% and 8.2% of total deals.

Collectively, homes valued under 18.5 billion rials ($70,476) had a 52.6% share of total home deals in Tehran during the seventh month of the current year.

During the seven months of the current Iranian year, the number of home deals finalized in Tehran totaled 63,577, which shows a 77.6% rise year-on-year.

In the same period, the average price of each square meter of a house in the capital stood at 208.91 million rials ($795), signaling a YOY surge of 64.3%.