Amid a nationwide housing crisis, Iranian domestic media reports have raised concerns over the government’s refusal to release millions of hectares of state-owned land for residential development. Despite an ongoing housing shortage, the administration of Masoud Pezeshkian, like its predecessors, has declined to allocate nearly two million hectares for building much-needed housing units.
Housing Market Struggles Amid Price Surge
Iran’s housing market has been stagnant in recent years, but land and property prices have surged at an unprecedented rate. In Tehran, official statistics indicate that 51% of residents are renters, while 42% of households fall below the housing poverty line. Rising land and housing prices have made home ownership increasingly elusive for average Iranians, particularly those in urban centers.
An article by the ISNA news agency, titled “What is the story of the hoarding of about two million hectares of land?” sheds light on this pressing issue. The report notes that transferring just 6% of government-held land could effectively address the shortage of seven million residential units in Iran. Other Iranian outlets have echoed these concerns. Quds newspaper criticized the government’s monopoly over state-owned land, while Farhikhtegan pointed out that “land 30 times the size of Tehran’s area has been hoarded.”
A Growing Crisis Despite Available Land
The government claims that land scarcity is a significant barrier to affordable housing. However, official data from the Ministry of Roads and Urban Development suggests otherwise. The National Land and Housing Organization, which falls under the Ministry, reportedly holds more than 1.8 million hectares of undeveloped urban land.
Last week, Mohammad Bagher Ghalibaf, Speaker of the Iranian Parliament, highlighted this issue at the annual Housing Foundation conference. He remarked that “the National Land and Housing Organization has vacant land twice the size of residential land in the entire country.” Despite acknowledgment from senior officials, no substantial actions have been taken to release these lands for residential construction.
Economic Toll on Households
The rising cost of housing has had a severe impact on Iranian households. In 2023, the land share in the total cost of housing exceeded 42% in cities and over 55% in Tehran. By 2024, housing costs had come to consume 56% of the average household’s budget in Tehran, placing immense pressure on family finances. Statistics reveal that the rising cost of housing correlates closely with escalating land prices.
In his campaign earlier this year, Pezeshkian pledged to address livelihood issues and prioritize the needs of the underserved. Yet, recent data from the Iranian Statistics Center shows that housing rental costs continue to account for the largest share of inflation impacting Iranian households. Meanwhile, reports from the Central Bank of Iran indicate that approvals for housing loans by 17 state banks remain “close to zero,” and several banks, including Eghtesad Novin, Iranzamin, Gardeshgari, and Karafarin, have abstained from the government’s “National Housing Movement” initiative.
The September report from Iran’s Statistics Center revealed that housing prices contributed to 57% of national monthly inflation, an upward trend that has persisted throughout 2024. This contrasts sharply with international standards, which suggest that housing costs should ideally constitute no more than 30% of a household’s expenses to ensure quality of life and family well-being.
A Long Road to Homeownership
The staggering housing prices mean that Tehran’s renters now face an estimated 150-year wait to afford a home, should current price trends continue. Soaring rental prices have even forced some families into unconventional shelters, such as rooftops or tents, as conventional housing options slip further out of reach.
The Iranian government’s persistent land retention, coupled with skyrocketing housing costs and stagnant wages, continues to exacerbate an already critical housing crisis. Until substantive action is taken to release state-owned land for residential use, the prospect of homeownership will remain a distant dream for millions of Iranians struggling under the weight of housing inflation.
