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Officials warn of rising house prices in Iran

Business Materials 6 July 2013 08:31 (UTC +04:00)

Azerbaijan, Baku, July 4/ Trend N. Umid/

Capital flows from foreign currency and gold markets to the housing sector is dangerous and will cause prices to rise in this sector, member of parliamentary economic committee, Osman Ahmadi said, Jahanesanat daily reported on July 4.

After the presidential elections in Iran, the national currency's rate rose against foreign currencies by 10 per cent, while gold and gold coin prices dropped in value.

According to the reports, capital is channelled from these markets to other sectors, including housing. Ahmadi said the government has not been running the correct policy linked to economic issues.

He predicted the price of gold and foreign currencies will soon decrease.

Ahmadi recommended that the interest rate of bank deposits should increase to absorb released capital from gold and foreign currency markets.
Prior to the presidential elections in June 14, each USD was sold at 36, 500 rials, but this figure decreased by 20 per cent in two weeks and again rose to 33, 200 rials.

The value of one square metre of land for residential building increased by 157.1 per cent in Tehran last winter compared to the year before, the Mehr News Agency reported on July 3.

Residential land and rundown buildings were sold at 56 million rial per square metre on average in Tehran.

Built-up land was also sold at 39 million rial per square metre, up 19 per cent compared to the year before. Rentals increased by 28.4 per cent on average.

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