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Deal to Have No Immediate Impact on Housing

Deal to Have No Immediate Impact on HousingDeal to Have No Immediate Impact on Housing

Iran and the six powers reached a historic deal on Tuesday after 20 months of negotiations to settle a 12-year dispute over Tehran’s nuclear energy program. Almost everyone in Tehran hopes sanctions relief could boost various markets in Iran.

However, Minister of Roads and Urban Development Abbas Akhoundi has said the deal would hardly affect, in a positive way, the housing market in the near future.  

“Emotional behaviors should be avoided in the market,” he said, noting that his ministry is planning to “remove intermediaries that have created lots of problems in the housing market due to their speculative activities.”

According to Alef news website, the minister made the remarks in a meeting with Tehran’s mayor and the representatives of 16 ministers in Tehran on Tuesday.

In a separate development, Hesam Oqbaei, head of Tehran’s Real Estate-Union, shared the same idea that he sees no special change in the value of houses in the near future.

“A price shock is expected when a large amount of resources are to be injected into the market, which is not the case now. Capitals are mainly deposited in banks due to higher expected rate of return.”

Mohammad Edalatkhah, a real-estate expert, blamed unplanned investment for the housing recession, arguing that the government needs to avoid further injection of money into the market; otherwise, it could face an imbalance between house supply and demand.

Many experts believe it will take the government several years to lower inflation and achieve a high rate of economic growth; so homebuyers should not expect a sudden improvement in the housing sector.

Financialtribune.com