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Conservative Jomhouri Eslami criticizes the housing chaos and oppressively high prices

Friday, 1 June 2012

Under the headline, “Housing and the Problem of Narrow Vision,” the conservative newspaper, Jomhouri Eslami, examines the housing situation in Iran at the beginning of the summer, when many rental contracts are renewed and many people move. It notes a sharp increase in the prices of housing for both purchase and rental, which is a cause of great concern for the general public. Prices increase every summer, but this year they climbed at least 15% in the spring. Experts claim that there are several reasons for this early rise, including the psychological impact of the possibility that the second stage of the subsidy reform would be implemented, the increase in the prices of raw materials and the lack of a clear answer regarding possible increase in the minimum wage. The government, which is responsible for the housing market, faces serious challenges managing it. Unlike previous years, when the government published extensive information about the supervision of contracts and rentals, this year it is silent and it seems that after the failure of last year’s nonprofessional methods, the responsible officials in the government have no intention of repeating this disgrace in the government’s final year. Examination of the system proves that methods including rent control, and imposing limitations on agents, buyers and sellers of apartments have not led to positive results. Rather they have increased the lack of transparency and lead buyers and sellers to sign purchase contracts outside of institutional agencies. This proves to the government, as has been shown many times before, that rules alone cannot regulate economic life and management of economic reality requires familiarity with the deeper roots of an issue and proper management of the sector. The government’s practical programs have not been particularly successful despite the many articles on the effect of subsidized government housing on prices. It seems that this program holds little hope. According to official data, between 700,000 and 800,000 people enter the housing market each year, and there is a huge shortage (approximately 2 million housing units) throughout the entire country. People looking for new apartments cannot find what they seek in the reduced-priced government housing, because they are mostly from the middle class or young couples who do not qualify for government housing. The increased demand for apartments in cities has also contributed to the increase in prices. A look at the overall picture leads to the conclusion that the government must resolve the housing crisis as a component of the national economy and not only by taking a narrow view of the housing market.

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  • Published: 7 days ago on Friday, 1 June 2012
  • By: Iran Daily Brief
  • Last Modified: June 1, 2012 @ 10:50 am
  • Filed Under: Economy
  • Tagged with:
  • Source(s):
    • http://www.jomhourieslami.com/1391/13910308/13910308_01_jomhori_islami_sar_magaleh_0001.html

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