TEHRAN, Iran, Jan.17
Trend:
Iran's housing market will be affected by the political and military tensions, housing market expert Mehdi Soltan Mohammadi told Trend.
"In turn, these tensions will affect people's incomes that results in negative economic growth," Mohammadi said.
"The data indicate that families' incomes in current Iranian year (began March 21, 2019) are less than in previous years; apparently, their savings for purchasing house have dropped," the expert added.
"This has created problems for people in terms of paying house mortgages, while decrease of house purchase has also negative effect on economic growth as well. Most of the people do not seek to save money and reduce the volume of their purchases," Mohammadi said.
"Increase of political and military risks would increase economic risks. Currently, investors have less interest to invest in housing sector since the economic outlook for the future is not bright," he added.
"Furthermore, foreign currency rates will rise. Increase of tensions would create difficulty in supplying construction material, while the high inflation rate leads growth of the house price," Mohammadi said. "If the inflation rate rises to more than 40 percent, the house price would have 25-percent growth; however, it will not increase as much as other commodities."
"There has not been considerable effect on the steel products, since the US new sanctions against Iran's steel industry and the market are not so severe and the rates have not changed drastically," he said referring to the effect of sanctions against Iran's steel industry on housing market.
The Trump administration recently imposed new sanctions on Iran following Tehran’s attack on U.S. military bases in Iraq.
In addition to sanctioning 17 steel and mine producing companies, the US Treasury Department has also sanctioned a network of entities based in China and Seychelles alongside a vessel involved in the transfer of Iran steel products.