“Majlis has allocated about 70 trillion rials ($18.5 billion) to construction projects in the 2017-18 budget while the figure needs to be multiplied to bring about a 5% growth in the economy,” Gholamreza Tajgardoun also said during a TV interview as reported by Eximnews website.
Members of Majlis Development Commission had earlier said that the share of housing budget in 2017-18 will be adequate if it is realized in full, while others warned about gloomier days for the beleaguered sector.
In total, 8.14 trillion rials ($206.9 million) have been considered for the housing sector, which constitute less than 10% of the total budget allocated to the Ministry of Roads and Urban Development, according to Financial Tribune.
The housing sector has been suffering from deep recession for some years now. Government schemes such as establishing the Housing Savings Account to provide cheap mortgages to first-time homebuyers have not helped revive the sector.
A scheme by builders to sell houses on installments also met with lackluster demand.
Tajgardoun noted that lack of resources can be made up by attracting investments, issuing bonds and directing funds toward the production sector. “Tax income is predicted to surpass oil income in next year’s budget since it is going to increase by 20%,” he added.
According to the official, no price increases are forecast in the new budget while vulnerable strata have received special attention and the pension system will become fairer.