According to Tejarat News, the Statistics Center of Iran finally published a report on the developments of Tehran’s housing market after several months of silence. According to this report, the average housing price in Tehran has reached 77,480,000 tomans, which has decreased by two million tomans compared to last month, August.
In this regard, the inflation statistics of this market have gone through a downward trend during these two months. According to this report, point-to-point inflation in August was 84.1%, which reached 75.2% by the following month. But in the meantime, the annual inflation follows a path opposite to this trend. Housing inflation, which was estimated at 82% last year, has been recorded at 83.9% this September.
But to what extent has this reduction in housing prices in Tehran had a positive effect on the market and how valid is it?
Providing statistics in recessionary conditions
Baitullah Satarian, an expert in housing economics, told Tejarat News: “When certain statistics are to be provided for a product, the conditions of that product should be taken into account in different periods.”
He continued: “For example, the evaluation in the period of recession compared to the period of prosperity requires consideration of other factors. When 10,000 transactions are made in Tehran in a month, the average price is considered. “The next month, when only 100 transactions have taken place, it is no longer possible to judge whether the price has decreased or increased.”
This housing economics expert explained in this context: “In this situation, there was no basis for the transaction. In the evaluation of a commercial transaction, there is also the discussion of transactions, and many numbers are excluded from the evaluation. Satarian said about the impact of the recession on the price: “It is the recession that lowers the price while the seller is not willing to sell his house for a rial cheaper.”
He also clarified: “If you examine the heart of the market, you will find that inflationary stagnation is also going on now, the price is going up, but no deal is being made.”
As it was mentioned, experts believe that the decrease in the price that the statistics show now comes from the stagnation prevailing in the market. Due to the lack of customers and in dire need of their capital, sellers sometimes announce the price lower than the market price, and as a result, a price reduction is seen in the small number of transactions that happen.
Therefore, it cannot be considered that these statistics can have a positive impact on the market and improve its trend in the coming months.
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