69448
Factors Behind Tehran Home Rent Rally
Factors Behind Tehran Home Rent Rally

Factors Behind Tehran Home Rent Rally

Factors Behind Tehran Home Rent Rally

Defying the housing market’s years-long sluggish trend and flat home prices, home rents are registering growth.
Deciphering the enigma, director of Tehran Association of Realtors has cited three reasons for the anomalous trend.
“The major determining factor of rents is the property’s value, but this rule does not apply to our country due to three factors: First and foremost, the demand for housing in the capital outweighs supply and hence the hike in rents,” Hesam Oqbaei told state radio, Tasnim News Agency reported.
He traced the second factor to the headline inflation that affects home rents like in every other market.
“Currently, the inflation rate in the country is around 12-13% while the average growth of rents in Iran has not exceeded 7-10%,” he said.
While the average growth of rents across the country might be 7-10%, the figure in capital is far more than that.
Local realtors in northern districts of Tehran have told Financial Tribune that apartments’ rents in the upscale areas have significantly risen by up to 40%, compared with the corresponding period of last year.
Inquiries in central and southern parts of the city revealed that rents have increased by 20-30%, which are higher than the average increase announced by officials.
Oqbaei mentioned bank high interest rates as another major reason for rents’ bullish trend.
“An apartment located in western parts of Tehran worth around 5 billion rials ($131,000) fetches a maximum rent of 20 million rials ($524) per month while banks offer 100 million rials ($2,622) for such a deposit. Therefore, owners expect that kind of profit from their property,” he explained.
The director of Tehran Association of Realtors noted that high interest rates have pushed Iran’s production sector to the brink of recession, hence people are more eager to deposit their savings in banks and this stokes the growth in rents.
The realtor criticized private banks for waging a price war over interest rates.
“Private banks have established a mafia and their operations have nothing to do with banking activities and now even the Central Bank of Iran cannot control them. Banks own lots of residential and commercial complexes across the city, which is definitely against the law,” he said.

Short URL : https://goo.gl/AXCfg1
  1. https://goo.gl/eVVLQp
  • https://goo.gl/tiGYC8
  • https://goo.gl/eq8WMx
  • https://goo.gl/zLHEsJ
  • https://goo.gl/PwrzfZ

You can also read ...

Iran Missing Advantages of Foreign Banks’ Presence
Tehran Chamber of Commerce, Industries, Mines and Agriculture...
Oman Eyes Iran Market Amid Rising Imports
Ithraa, Oman’s inward investment and export promotion agency,...
Luxgen’s S3 is a 5-seater subcompact sedan equipped with a 1.6-liter, 116 hp gasoline engine.
Local company Arman Motor Kavir is set to unveil two imported...
Iran Exim Bank Tapping NDFI Resources
Export Development Bank of Iran–the country's exim bank–is to...
Transport MoU With South Korea
Iran and South Korea have signed a memorandum of understanding...
Billet and bloom shipments made up the bulk of exports, reaching 1.78 million tons, up 28% year-on-year.
Iran’s semi-finished steel exports during the first seven...
Local producers have often called  on the government to increase import tariffs on tires.
In order to “protect domestic production”, the Industries...
IRIB Mulls Issuing Bonds
The Islamic Republic of Iran Broadcasting is considering...

Add new comment

Read our comment policy before posting your viewpoints

Image CAPTCHA
Enter the characters shown in the image.

Trending

Googleplus