Factors affecting the disorder of the housing market / Are government policies in the housing sector counterproductive?

According to Tejarat News, the situation of the housing market has plunged into a critical situation especially since the last few months and now it is stagnant both in the field of production and in the field of transactions. But what factors have been effective in this field and if this situation continues, where will the housing market go?

In this regard, Mohammad Mortazavi, head of the National Association of Mass Housing Builders, told Tejarat News: “Prediction of the future of the housing market depends on various factors and conditions, which means that a multifaceted issue should be followed.”

Referring to the external factors affecting the housing market and the role of the government’s policies in determining the direction of this market, he added: “The first debate in the market of housing transactions and the final price is related to how the government’s actions and interactions with other countries will be, i.e. “How will our relations in the international field be formed?”

The impact of inflation on the housing market

Mortazavi further pointed to the impact of inflation and stated: “One of the most effective topics, both in the field of housing and in all economic topics, is inflation, which we have witnessed in the past years; As a result, the expansion of a number of economic anomalies in the country, which was the result of inflation and returned to sanctions, has been effective on this market.

He continued: “When the damage of the sanctions reached the country’s economy, we saw that all the conditions changed and suddenly the effect of the sanctions on the increase in the finished price and even the acceleration in the presence of transactions became visible.”

The head of the National Association of Mass Housing Builders said: “Whenever the monetary base increases, especially due to sanctions, inflation occurs and the value of the national currency falls; We have always witnessed that this trend has had an impact on the trading market as well.”

The impact of sanctions on the economy

He also explained about the impact of sanctions on the economy: “The first issue comes back to how we will act in the field of international relations, foreign policy and the way we look at establishing relations with the countries of the world. The government previously stated that we do not tie the fate of the economy to sanctions, but we have seen in practice that such an event is impossible and impossible, and we have seen its effects on the country’s economy, and the harmful effects of sanctions will continue.”

Mortazavi stated: “This issue will be very effective in the future of the housing market and other issues will be placed next to it. In fact, we should follow the support of the investment market in the housing market, and this support comes back to being able to have a correct forecast and reduce the effects of inflation in some sectors.”

Shall we build supportive housing or not?

The head of the National Association of Mass Builders said about housing price control: “Mandatory pricing is definitely not what we want, but we have to control price increases in such a way that these things have less effect on the finished price.”

He also explained about targeting in the housing market: “We must have correct targeting in the housing market; For example, if today we promise to build one million supportive housing per year, we should also consider whether one million supportive housing per year has an effective demand in our country?

Mortazavi emphasized: “The category of housing affordability has been called into question, and we must first strengthen the households and target groups, and then start producing supportive housing.”

He continued: “Since the funds of the housing market are directed towards the construction of supportive housing, it weakens other sectors and affects the production of housing by the private sector.”

Mortazavi explained about this: “The private sector also uses housing facilities, but when the housing facilities are allocated to the supporting sector or we have incentives for this sector and we do not give it to the private sector to follow the normal flow of housing construction and production. This approach will reduce and withdraw capital from the private sector.

The head of the National Association of Mass Housing Builders said about the deviation in the production path: “Whatever we build, but it is not within the power of the target groups, it causes the resources we brought to these sectors to be lost, which is considered a deviation in the production path.”

He continued: “If we want the housing conditions in the country to become ideal and to be able to improve housing production in the 10-year and 20-year perspectives, we need to have upstream plans.”

The need for upstream plans in the field of housing

Mortazavi explained: “Currently, the housing sector lacks efficient upstream plans, and it seems that we have no say in the construction and production of housing in the country before such plans are prepared. The other part also comes back to how the laws and regulations that are continuously enacted in the field of housing have an effect on the production and housing market.

He explained: “The truth is that I don’t have much hope for the government because in recent days I have seen that policies have been put in place that are said to have the aspect of fighting speculation, but in practice what is happening is counterproductive and worries activists in this field.”

Mortazavi said: “As long as there is a change of procedure in such policies and the government’s view changes and it pursues the goals constructively, we can imagine a better future for the housing market.” But if we close our eyes and pass these conditions easily, naturally we cannot hope for the future of the housing market, and we will see stagnation, a decrease in production and fewer deals.”

Inefficient policies, along with the inaction of the Ministry of Housing and Urban Development in recent years, which of course has worsened since the beginning of the President’s government, have created the suspicion that the government does not have a correct understanding of the problems of the housing market and is trying to solve issues with superficial policies that Its deep roots must be sought in macroeconomics!

Read the latest housing news on Tejaratnews housing news page.