Iran Government Rolls Out Security Deposit Loans

EghtesadOnline: Tenancy agreements signed from September 2020-21 are eligible for security deposit loans, says Ali Qaedi, an official with the Ministry of Roads and Urban Development.

News ID: ۷۸۶۹۵۲

05 September 2021

“Enrollments for security deposit loans started on June 16. Thus far, 740,000 have applied for security deposit loans, of whom 81,000 have been introduced to banks. The interest-only security deposit loans worth 700 million rials [$2,590] in Tehran, 400 million rials [$1,480] in large cities with a population over one million, namely Mashhad, Isfahan, Karaj, Shiraz, Tabriz, Qom, Ahvaz and Kermanshah, and 250 million rials [$925] in other Iranian cities will be paid to tenants,” he said.

“The lending rate of security deposit loans stands at 13% with the repayment period of five years for renters in Tehran and three years for the other two groups,” he was quoted as saying by IRIB News.

“There is no need for applicants approaching ministerial offices; they only need to register online via National Housing Initiative website and refer to the nearest bank at the final stage once the procedure is complete.”

Qaedi said three requirements are defined by the National Coronavirus Headquarters to qualify for security deposit loans: being the head of the household, not possessing a property and the date of tenancy contract must be from Sept. 22, 2020, to Sept. 22, 2021.

“Married men and single women above 35 are eligible to receive security deposit loans. The tenancy agreement must have been finalized at real-estate agencies or notary public offices and registered at the Tenement Management Information System [the so-called tracking code system],” he said.

“NCH has allocated 100 trillion rials [$370 million] for security deposit loans. Therefore, the imposition of special restrictions on the number of applications seems unlikely.”

According to Deputy Minister of Roads and Urban Development Mahmoud Mahmoudzadeh, those whose tenancy agreements expire in the second half of the Iranian year (Sept. 23, 2021-March 20, 2022) can also upload the needed documents, Hibna reported.

The average Consumer Price Index for rent levels of residential homes in urban areas during the four-quarter period leading to June 21, which marks the end of spring, increased by 28.8% compared with the corresponding period of last year.

The Statistical Center of Iran had put the annual inflation rate for the preceding quarter (winter), which ended on March 20, at 27.5%.

The highest and lowest average annual inflation rates were registered for Hamedan and Sistan-Baluchestan provinces at 38.3% and 13.6% respectively.

According to the SCI report, CPI for rent levels in urban areas (using the Iranian year to March 2017 as the base year) reached 226 in the first quarter of the current Iranian year (March 21-June 21), indicating a 3.5% increase compared with the previous quarter.

SCI had put the quarter-on-quarter rent inflation rate for the preceding quarter, which ended on March 20, at 4.4%.

Kurdestan and Lorestan provinces registered the highest and lowest quarter-on-quarter inflation rates for tenants in urban areas with 8.9% and 0.6% respectively.

The consumer rent price index in urban areas increased by 29.1% in Q1 against the same quarter of last year.

SCI had put the year-on-year rent inflation rate for the preceding quarter at 28.9%.

The highest and lowest inflation rates on a year-on-year basis in the fourth quarter of the last year were posted by Kermanshah with 39.6% and Sistan-Baluchestan with 13.9%.