Latest data released by Iran Chamber of Cooperatives on Purchasing Managers’ Index for the construction sector shows the index has emerged from the slump following the New Year holidays (March 21-April 3).
The PMI for the construction sector settled at 35.32 in the second month of the current fiscal year (April 21-May 21) from 56.31 in the preceding month (March 21-April 20), indicating a 59.43% rise.
The first month of the Iranian year was marked by a slowdown in business activities across all economic sectors, including construction. However, the second month of the year, as shown in the accompanying graph, witnessed a recovery from the seasonal slump.
PMI is an indicator of the health of economic sectors and provides information about business conditions to decision-makers, analysts and purchasing managers.
Raw material inventory, employment conditions, new orders, supplier deliveries and export/production conditions are among the criteria quizzed, yielding a final score of between 1 and 100.
If a business scores 50, it means that no change has been perceived compared to the previous month, while scores higher or lower than 50 indicate that the business is expanding or contracting respectively.
The survey includes 12 business criteria and any changes, whether it be improving, no changes or deteriorating. It is measured through a monthly survey sent to senior executives of 100 companies active in the real-estate sector.
It is based on five major survey areas: "new orders" with a coefficient of 30%, "raw material inventory" (10%), "production" (25%), "supplier deliveries" (15%) and "employment" (20%).
The "new orders" sub-index stood at 46.84 in the month ending May 21, indicating a 21.41% increase compared with 38.58 in the month ending April 20.
The "supplier deliveries" sub-index, which measures how fast deliveries are made, increased by 6.41% from 44.02 in the month ending April 20 to 46.86 in the month ending May 21.
The "raw materials (construction materials) inventory" sub-index decreased by 0.5% from 39.67 in the month ending April 20 to 39.47 in the month ending May 21.
The "employment" sub-index increased by 1.41% from 46.19 in the month ending April 20 to 46.84 in the month ending May 21.
To calculate housing PMI, seven secondary criteria were also surveyed by ICC, including "raw material purchase prices", which stood at 79.34 in the month ending April 20. The sub-index grew by 8.11% to stand at 85.78 in the month ending May 21.
"Warehouse Inventory" increased by 0.51% to reach 43.15 in the second Iranian month from 42.93 in the first month.
The "exports" sub-index settled at 50 in the month ending May 21 from 46.73 in the month ending April 20, registering a 6.99% increase.
"Prices of products and services" increased by 12.04% to stand at 73.68 in the month ending May 21 from 65.76 in the previous month.
"Fuel consumption" increased by 13.17% from 48.36 in the first month of the current fiscal year to 54.73 in the second fiscal month.
"Sales" increased by 40.88% from 35.86 in the first fiscal month to 50.52 in the second month.
The sub-index of "performance expectations for the following month" settled at 48.94 in the month ending May 21 from 59.78 in the month before, showing an 18.13% decrease.
Tehran Home Sales at 21-Month High: CBI
The number of monthly home sales in Tehran has reached a 21-month high, the Central Bank of Iran’s new report on the capital’s real-estate market shows.
According to CBI, a total of 10,490 homes were sold in Tehran during the second month of the current fiscal year (April 21-May 21), registering a 206.1% jump compared to the month before and a 166.4% rise compared to the corresponding month of the year before.
The report also shows prices are at an all-time high. The average price of each square meter of a residential property in Tehran stood at 363.52 million rials ($1,130) during the month under review, registering a 26.2% rise over the preceding year’s same month, when average prices stood at 287.97 million rials ($895).
Home prices in the capital city increased by 6.1% compared to 342.73 million rials ($1,066) in the first month of the current fiscal year.
During the month ending May 21, residential properties up to five years old constituted the biggest proportion of deals at 29.6% (or 3,100 deals), down by 6.1 percentage points compared with the same month of last year.
The lost share was added to homes with a lifespan of 11-15 years and over 20 years. They accounted for 16.1% and 20.3% of total deals compared with the same month of last year’s 13.5% and 13% respectively.
The distribution of dealt properties indicates that among Tehran’s 22 districts, District 5 grabbed the biggest share of total deals at 16%, which was followed by District 10 with a share of 10% and District 2 with a share of 9.3%.
All-in-all, 10 districts (5, 10, 2, 4, 14, 7, 8, 1, 15 and 11) grabbed the lion's share of deals at 73.9%, with the remaining 12 districts holding a 26.1% share.
Among Tehran's 22 districts, District 1 registered the highest average home price of 744.4 million rials ($2,315) per square meter. District 18 offered the capital city's cheapest homes with an average per-square meter price of 183.6 million rials ($571). The aforesaid figures show a respective increase of 23.6% and 53.4% YOY.
Residential units with an average price range of 250 million rials ($777) to 300 million rials ($933) per square meter were the most popular in Tehran during the Iranian month under review, as they accounted for 15% of all deals. They were followed by units priced at 200 million rials ($622) to 250 million rials per square meter with a share of 14.2% and homes priced at 300 million rials to 350 million rials ($1,088) per square meter with a share of 11.6%.
From the total number of deals, 58.8% belonged to homes cheaper than the average per-square meter price of the city (i.e., 363.5 million rials or $1,130).
Residential units with a floor area of 50-60 square meters registered the highest number of sales, with a 15.3% share of total deals.
Units with an area of 60-70 and 70-80 square meters ranked second and third with a respective share of 15.1% and 11.5%. All-in-all, residential properties with an area of under 80 square meters had a 55.3% share of total deals.
The data indicate that Tehran’s homes worth between 10 billion rials ($31,104) and 15 billion rials ($46,656) were the most popular with a share of 17.7% from the total deals. These were followed by homes with a price tag of between 15 billion rials and 20 billion rials ($62,208), as well as those priced at 20 billion rials to 25 billion rials ($77,760) with a respective share of 12.2% and 10.7% of total deals.
Collectively, homes valued under 25 billion rials had a 51.3% share of total home deals in Tehran during the second month of the current year.
The central regulator also reported changes in tenancy prices in the capital city and across urban areas.
According to CBI, prices of rented residential units in Tehran and across urban areas increased by 46% and 50.6% respectively during the second fiscal month compared with the corresponding month of last year.
