Autumn boom of the housing market; Reality or mirage? – Tejarat News
According to Tejarat News, the data of Divar platform says that the publication of advertisements for the sale of residential apartments has followed the pattern shown by the Central Bank report. This is while it was expected that at this point, the markets in general, and as a result, the housing market, under the shadow of the country’s special socio-political conditions, would not prosper much.
To investigate these developments, we have taken a look at the real estate market in Tehran; The number of ads published by Wall users for the sale of residential apartments in Tehran in October this year was at the end of the four-month downward trend leading to this month.
This trend started in July and with a gentle slope between 3 and 4% monthly decrease reached September and suddenly dropped by 20% in Mehr. From Mehr onwards, this trend picked up and grew in the months of November and December.
Of course, this growth was not to the extent that the autumn average could compensate for the summer drop; The general trend of buying and selling residential apartments in Tehran, according to Central Bank reports, shows the same ups and downs pattern.
That is, the actual transactions, according to what was recorded in the real estate transaction system during this period, also show that in the sales sector, we have seen a downward trend in the summer and the first month of autumn this year, and after that, the buying and selling of residential apartments in Tehran showed an upward trend to has taken
In Mehr 1401, it seems that in addition to the trend of the previous season, the shadow of social conditions has weighed on the housing market. But in November, the situation suddenly changed. The number of transactions in this month increased 1.5 times compared to Mehr and reached more than 10,000 units in Azar, that is, it is close to the border of the housing market exiting the recession (which is about 10-12,000 purchases and sales per month in Tehran). became.
Meanwhile, inflation is still high in the housing market. Of course, the heavy housing inflation along with the social factor should not have allowed housing transactions to grow. What pushed these two factors to the sidelines was the sudden jump in the price of the dollar at this point.
The effect of changing the dollar rate on the housing market
Apparently, contrary to the past trend, the effect of the change in the dollar rate imposed itself on the housing market much earlier, because housing usually reacts to important currency fluctuations after one or two months.
With the sudden increase in the currency price, the dollar price of each square meter of residential apartment decreased. Note that this decline occurred while housing inflation remained high.
Its simple meaning is that the “consumption” purchase of housing for the owner’s personal use is still not justified, but its purchase as a “capital” product is justified to some extent. In fact, first-time homeowners still cannot buy a house, but the situation is different for investors.
In such a situation, the investor may purchase the property for two reasons. One is because currency and coin fluctuations drive people with less risk-taking towards safer capital goods.
These people aim to preserve capital. Another reason is the increase in inflation expectations. When the price of the dollar rises, a psychological atmosphere prevails in the market, which is known as inflationary expectation, that is, the public’s expectation that the price of goods will increase in the future. Naturally, such an expectation causes a part of the capital to lean towards the housing market.
But this growth never means that the housing market is out of recession. The market prospers when the number of transactions in Tehran increases from 10 to 12 thousand units per month for a few months and an important part of the purchases is “consumption” rather than investment. With the current situation, there is no prospect for improvement.
Ways to open the housing market
The smartest way to open in this market is policies leading to a decrease in currency prices, otherwise the door will turn on its heel. Especially since housing and construction materials are completely dependent on the currency, and naturally, with the current conditions, it will not be possible to supply new units in bulk to the market. The proof is the withdrawal of the new Minister of Roads and Urban Development from the election promise of the head of the executive branch.
What is currently evident is the fact that the weight of the economic policies of the government and parliament on the housing market in the fall of 1401 was much more than the weight of socio-political factors in recent months. The economy goes its own way. We have to look for the roots in the right place.
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