falling housing prices; From reality to news therapy – Tejaratnews

According to Tejarat News, in recent weeks, some media outlets have published news about the reduction of housing prices. Even some of these media mentioned the decrease of housing prices by 20% according to experts. This number was especially reflected in the words of Iraj Rahbar, the head of the Center of Mass Builders of Tehran.

These statements and news were met with reactions from the activists of the housing market and the public. The fact of the matter is that for the past five months there has been no news about housing development statistics and the Central Bank has remained silent about it. Based on this, the critics say how can this figure of 20% be achieved when there is no benchmark and base price for it and it is not clear what price the 20% reduction was calculated from.

There has been no change in the housing market

In this regard, Farshid Pourhajat, a member of the board of directors of the National Association of Mass Housing Builders, said in response to the statistics of a 20% decrease in housing prices that it seems that Mr. Rahbar did not clearly state that we had a decrease in housing prices. In the past months, we did not have any statistics in the country related to the housing sector to monitor the statistics to find out whether we faced a decrease or increase in housing prices or a decrease or increase in housing production.

He added that on this basis, it seems that it was a mistake to try to document the situation of prices in the media without knowing the conditions of the housing market.

The member of the board of directors of the National Association of Mass Builders of Housing has stated in an interview with Khabar Online: As a person who worked in the housing market for many years, I did not observe a 20% decrease in the price of housing under any circumstances, and the market is in special conditions as in the past. And no fundamental changes have occurred in the housing market.

The shadow of inflationary stagnation on the housing market

It should be mentioned that the field survey of the housing market, especially in Tehran, also indicates that housing prices have experienced a strong rise, not only a decrease, during the past months. Even in recent weeks, there has been no reduction in prices, but the reduction has only occurred in the demand sector and has pushed the market towards inflationary stagnation.

What is clear is the government’s attempt to heal the housing sector in the midst of a drop in the dollar price; This is despite the fact that the housing market has always faced a trap called price stickiness, and whenever the price rises due to the pressure of external factors such as the dollar and inflation, after the weakening of these factors, it has not come down or has decreased very little. Examining the trend of housing prices over the past 40 years also confirms this.

Even now, the housing market is suffering from the same trap, price stickiness, and now it has stagnated due to the sharp decrease in people’s purchasing power along with the increase in prices. Accordingly, perhaps it is better to attribute the 20% decrease in the housing market to demand rather than to prices!

Read more reports on the housing news page.