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Housing Affordability Report Inaccurate

Housing Affordability Report Inaccurate  Housing Affordability Report Inaccurate

Figures published by the Ministry of Roads and Urban Development in a recent report on housing affordability threshold contradict market reality, a senior economist told the banker.ir website.

Hussein Raghfar said that measuring the poverty line for housing needs should be based on the average number of rooms or the average living area shared by a household. He criticized the findings by saying that the study failed to uphold a specific criteria.

“The poverty threshold in Tehran province, even in the cheaper southern regions, stands at a higher level,” he said, adding that the threshold for affording a roof over one’s head is way above 1.33 million rials ($44.4 at the official exchange rate) per person in the province.

Raghfar referred to a similar study conducted by him in 2008 and said, “My colleagues and I made use of both the abovementioned indicators and came to the conclusion that measuring the average dwelling place per person is a more reliable method for assessing living standards in Iran.”

While the Road Ministry’s report had concluded that 11% of Tehran Province residents live under the housing affordability threshold, Raghfar’s findings pointed at a significantly higher rate of 30%, considering an average area of 16 square meters per person as the minimum housing requirement.

“The figure is definitely higher now as the housing prices have grown substantially over the past few years,” he noted.

The Ministry of Roads and Urban Development report, published last week, claimed, among other things, that for every individual to stay above the ‘housing needs’ poverty threshold in Tehran Province, they must to be able to put aside 15 million rials ($500) of their annual income for housing.

Financialtribune.com