160% increase in the cost of construction in 1402 / will inflation cause the real estate market to stagnate?
According to Tejarat News, the increase in the cost of construction in recent years can be seen as the main factor for reducing the desire to build on the part of mass builders. In particular, inflation has caused an increase in the cost of construction on the one hand, and on the other hand, it has caused a decrease in people’s purchasing power, resulting in a sharp drop in demand.
The increase in the cost of construction has made it beyond the ability of a large part of construction industry activists to finance the project of building an apartment, and it has reduced the profit of those who enter into construction to a significant extent. According to some statistics, the profit of the builders has decreased to about 28%.
Construction cost in 1402
1 and 2 storey buildings
The Construction Engineering System Organization has recently announced the construction cost of each square meter of the building for the year 1402. Based on these data, the cost of construction for one and two-story buildings will increase from 3,600,000 tomans this year to 9,300,000 tomans in 2012; This means that the construction cost will increase by 3.158% in the future.
3 to 5 storey buildings
In three to five-story buildings, the construction cost floor this year is 4 million 200 thousand tomans, which will increase to 10 million 900 thousand tomans in the new year, equivalent to 5.159%.
6 and 7 storey buildings
The highest rate of increase in construction price belongs to 6 and 7 story buildings with 160.4% growth. The cost of construction in this group will reach from 4 million 800 thousand tomans this year to 12 million 500 thousand tomans in 1402.
8 to 12 storey buildings
Also, the construction of eight- to 10-story, 11- and 12-story buildings will experience an increase of 3.159 and 160 percent respectively in the next year.
The cost of construction in eight to 10-story buildings will increase from 5,400,000 tomans in 1401 to 14,000,000 tomans in 1402, and 11 and 12-story apartments will increase from 6,000,000 tomans this year to 15,600,000 tomans in the coming year. They have a price.
13 to 15 storey buildings
The cost of building 13 to 15-story buildings will increase from 6.6 million tomans this year to 17 million tomans next year, which is equivalent to a 6.157% increase in cost.
Buildings of 16 floors and above
The last group is buildings with 16 floors and above, whose construction cost will increase from seven million and 200 thousand tomans this year to 18 million and 700 thousand tomans next year, and they face a 159.7% increase in construction price.
Of course, these prices can decrease or increase by up to 25% based on the proposal of the provincial board of directors and the approval of the four-person board in each province, according to the conditions and quality of construction.
Increasing the cost of construction inputs
The increase in the price of construction inputs, which has increased in line with inflation in recent years, is considered one of the important factors in the increase in construction costs.
According to the latest data of the Iranian Statistics Center, the price index of housing construction inputs in the fall of 1401 and in the city of Tehran was recorded as 1,561. This amount has increased by 6.4% compared to the last season i.e. the summer of 1401, 6.31% compared to the fall of last year and 34.7% compared to the 12 months leading to the fall of this year (annually).
Meanwhile, the inflation of construction inputs in the summer of 1401 has decreased by 3.4% compared to the previous season.
In the fall of this year, among the executive groups, the highest point-to-point inflation with 9.63 percent belongs to the glass executive group and the lowest point-to-point inflation with 2.15 percent is related to the iron hardware, rebar, door and window profile and fence executive group. have been.
Construction slump in 1402
Earlier, Mahmoud Olad, an expert in housing economics, said in an interview with Tejarat News: The housing market is currently severely limited and there has been no construction for years. People’s low purchasing power also does not allow their demand to be directed to the market.
He added, on the other hand, the increase in prices has led to the growth of capital demand, and this itself has been the reason for the price increase, and it also seems that this trend will continue in the future.
As it was said, experts believe that due to the prospect of increasing inflation in the next year, high prices will cause the housing market, both from the supply side and the demand side, to decrease sharply from May. The increase in the price of construction can also be considered another reason for this recession.
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