Page 35 - IRANRptJun18

9.1.6 Property sector news
Property sales in Tehran made strong gains in the second month of the Persian year (April 21-May 20), moving up 16.7% y/y, the Central Bank of Iran (CBI) said on May 28. The surge in property sales in Iran’s capital comes as Iranians look to stave off any further losses caused by the plight of the Iranian rial (IRR), down more than 50% in value on the black market over the past six months in the face of economic jitters triggered by hostility and impending heavy sanctions from the Donald Trump administration.
Property has always been seen as a safer bet in uncertain times in Iran.
As prices increase amid rising demand, Tehran developers often try to make units more affordable by cramming small apartments into a building.
In total, 19,100 residential units changed hands during the one-month period. The previous month saw fewer transactions because people were gradually arriving back from the two-week Nowruz new year holiday. The month on month property sales jump was thus unsurprisingly as big as 278.7%.
New home sales (the data groups properties less than five years-old) accounted for the most significant share of sales in the second month, with some 8,392 units sold, which was equivalent to 43.9% of all properties sold. Tehran’s newer western suburbs see the bulk of transactions due to property availability and lower prices overall. The most expensive area of Tehran remains the mountain-hugging, wealthy neighbourhood of District 1. Its official average per sqm price is IRR125.4mn.
Homebuyers in Iran’s capital could receive a boost in a proposal from the Roads and Urban Development Minister, Abbas Akhundi, who on April 28 said the mortgage ceiling for homes in Tehran could increase to IRR2bn (€39,215), Saat24 reported on April 28. Mortgages in Iran are offered by a few banks but are fixed and related to either a home renovation or the purchase of a new property. According to the current rules, people looking to purchase a mortgage from Bank Maskan can receive a maximum IRR800mn (€15,700) loan for a home in Tehran. Outside of Tehran, the maximum loan offered in other cities tops out at IRR600mn (€11,674). For villages, the figure is IRR400mn (€8,400). On April 25, the Money and Credit Council, which meets at the Central Bank of Iran (CBI), approved cuts to interest rates offered in the market to future homeowners. Following that decision, interest rates on certain mortgages offered by the likes of Maskan Bank have fallen to 8% from the previous 9.5%, and to a lower 6% when it comes to rundown urban areas.
9.1.7 Tourism sector news
The number of Azerbaijani tourists visiting Iran was up 11.6% y/y in the first quarter of 2018, Trend News Agency reported on May 27. However, Turkey, Georgia and Russia experienced declines in their arrivals from Azerbaijan by 16.1%, 3.6% and 1.1% respectively. Iran has a sizeable Azerbaijani ethnic minority population, usually referred to as Azeris, which outnumbers the population of its neighbour Azerbaijan. It will welcome the increase in tourist trade brought to cities like Tabriz, Urmia and Rasht. Azerbaijani outbound travel in the same period to all other countries grew by 1.1% y/y, with 1.2mn people leaving the country. Some 27.7% of Azeris who travelled abroad entered Iran’s northern regions, often for shopping trips and to make use of the severe devaluation of the Iranian rial seen in the first part of this year. Inbound travel to Azerbaijan saw a significant boost during Q1 with people from 182 countries visiting the country. These people often typically
35 IRAN Country Report June 2018 www.intellinews.com