Home prices in Iran going through the roof

Home prices in Iran going through the roof

 

TEHERAN – AS IRAN’S economy is buffeted by inflation, the country’s homeowners are fast becoming richer in a real estate bubble that is driving affordable housing beyond the reach of ordinary citizens.

A luxury 1,400 sq m penthouse sold recently for US$21 million (S$29 million) at US$15,000 per sq m in swanky northern Teheran – yet the average monthly salary of Iranians stands at US$300 to US$460.

 

While the housing market of Iran’s arch-foe America is facing trouble, prices in Teheran’s affluent suburbs have gone up by at least 10 million rials (S$1,500) per sq m over three months.

 

Property prices there compete with upmarket neighbourhoods in Paris at a range of 60 million to 100 million rials per sq m.

 

‘You have to spend at least a million dollars to buy an apartment in northern Teheran where the average property is 200 sq m,’ says real estate agent Ali Meshkini.

 

With a stagnant stock market and a hesitant industry, property remains a privileged means to absorb liquidity, which has been flowing into the economy through windfall oil earnings.

 

Facilities such as swimming pools, saunas, jacuzzis and health clubs have become standard features in newly built upmarket homes to attract wealthier buyers.

 

An opulent residential tower in northern Teheran even comes with a heliport while another has a lift that takes cars up to the apartments.

 

The housing boom is not confined to the hot uptown market.

 

Average neighbourhoods in the capital, as well as in Iran’s other large cities, have been affected.

 

Prices have doubled within a few months in the satellite town of Parand and Hashtgerd, 50km from Teheran, while in Isfahan, Mashhad and Tabriz, property values have doubled in a year.

 

‘Property has become the only profitable investment,’ says Mr Meshkini.

 

‘Prices have risen by over 100 per cent within a year and they will continue to go up. No other sector makes such profits.’

 

Several entrepreneurs echo the same view, including the owner of a popular fast-food place in Teheran who complained he had made only ‘6 per cent net profit in the busy months of January and February, when sales were surprisingly high’.

 

AGENCE FRANCE-PRESSE

 

Source: Straits Times

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