An analysis of posts on Persian social media indicate that fast-growing residential rents have turned into one of the most serious economic concerns among Iranians.
After enduring a more-than-40% annual inflation rate for the past five years and seeing their purchasing power slashed to a fraction of what it was in 2018, Iranians now have to struggle with rising rents that are surpassing the monthly salary of an ordinary employee.
Iranians voice deep concern on a daily basis on social media about inflation and rising rents. The common thread among these posts is the citizens’ inability to pay rents, particularly in the capital city Tehran.
A user wrote on X: “I realized I only have money for four months of rent, and a little more to cover my monthly expenses. I got a few steps closer to mental breakdown.”
Another X user noted that she was unable to pay her rent last month due to medical expenses, further adding the economic situation in Iran is so dire that a friend asked me to lend him 1 million rials (less than $2) so that he could buy some bread and potatoes. The only cause behind poverty, corruption and exorbitant prices in Iran is the “terrorist regime” of the Islamic Republic, she stressed.
According to a poll conducted in October 2023, housing is the most important issue for Tehran residents, with problems such as low income and general inflation ranking next.
The findings of the poll indicated that rent accounts for an average of more than 50% of a household’s expenses in the capital where residents pay an average of 15 million rials ($300). This is while more than more than 50% respondents of the poll reported their monthly salary as less than 160 million rials ($320).
This has resulted in the migration of some Tehran residents to smaller towns around the capital such as Parand, Pardis, Hashtgerd, and Pakdasht, where they can afford the rents.
According to Iran’s leading economic daily Donyaye Eqtesad (World of Economy), the national rent growth in the first half of the year hit a 12-year high of 38.5%.
In 2022, Abdollah Otadi, a board member of the Tehran Real Estate Consultants Union, said rents had risen 300 percent in the last three years in the capital.
Examining the ratio of rent inflation to general inflation in Iran, Etemad daily wrote on Saturday that rent inflation has exceeded the monthly general inflation rate since September. A comparison between rent inflation over the past two years demonstrates that Iranian tenants have had a much tougher time this year to make ends meet, the report added.
The continuous devaluation of the rial, particularly since the US withdrawal from the JCPOA nuclear deal in 2018, has fueled inflation and plunged millions into poverty. Over the past six years, the rial has fallen 15-fold, from 40,000 per dollar to more than 600,000.
Official annual inflation hovers near 50 percent, but the rial’s continuous fall can directly impact prices and push the inflation rate to near hyper-inflation levels in the coming months. Earlier in the month, Eqtesad 24 daily warned that nearly one-third of Iranians struggle below the poverty line. The report projected a worrying escalation in poverty rates, foreseeing that by the end of the current Iranian year on March 20th, “the proportion of individuals below the poverty line could soar to 37 to 40 percent.”
The economic crisis has also eroded the government’s legitimacy, with a historic low voter turnout of 40% in the March 1 elections. Experts contend that economic turmoil is likely to worsen in Iran, with no end in site to its confrontational nuclear and regional policies.
Due to the rising inflation rate, real estate, like gold and foreign currencies, has been treated as capital investment in Iran, with many trying to avoid the rapid depreciation of their cash by buying houses and apartments. Real estate prices rise in tandem with the rising dollar.
According to Donyaye Eqtesad, owning a home in Tehran has become virtually impossible while the key indicators of the quality of life are also in decline. The average time people need to save money to be able to buy a residence in Tehran has increased to a staggering 112 years, from about 22 years in 2005, the report added.
Source » iranintl