Construction Industry Overview
– The construction industry of Iran is divided into government infrastructure projects and the housing industry.
– The construction industry in Iran is the largest in the Middle East region.
– 70% of Iranians own their homes, according to the Central Bank of Iran.
– The annual turnover in the construction industry amounts to US$38.4 billion.
– Iran has three shopping malls among the largest in the world, with Iran Mall being the largest.
Housing Demand and Statistics
– The total number of Iranian households is 15.1 million, with 13.5 million dwelling units.
– There is a demand for at least 5.1 million additional dwelling units.
– Every year, there is a need for 750,000 additional units.
– Currently, 2000 units are being built every day, but this needs to increase to 2740 units.
– Iran’s construction market is projected to expand to $154.4 billion in 2016 from $88.7 billion in 2013.
History of the Construction Industry
– After the revolution, the land question became a contested issue in the Islamic Republic.
– Tehran and Ahvaz experienced dramatic expansion, with Tehran doubling in size within two years.
– The state played a key role in the transfer of public land into private and cooperative residential property.
– Between 1979 and 1982, 75% of all new construction in Tehran occurred outside the formal city limits.
– The state’s share of investment in housing construction after the revolution was less than 2% of the total.
Market Overview
– 70% of Iranians own homes, with huge amounts of idle money entering the housing market.
– The housing industry is predominantly driven by private sector investment, with the state contributing only 2%.
– Around 3-6% of housing units constructed yearly are solely for renting purposes.
– The average annual increase in house prices has been around 20% over the past ten years.
– The average size of housing units is around 80 square meters.
Mehr Housing Scheme
– The Mehr Housing project aimed to build around 2 million housing units within 5 years.
– Bank Maskan provided loans up to 102 trillion rials ($10.2 billion) to applicants of the Mehr housing project.
– Real estate developers were offered free lands in return for building cheap residential units.
– 400,000 units have been built under the Mehr Housing project, with permits issued for another 12,000.
– The Mehr Housing project is expected to provide 600,000 residential units in its first phase. Source: https://en.wikipedia.org/wiki/Construction_industry_of_Iran
The construction industry of Iran is divided into two main sections. The first is government infrastructure projects, which are central for the cement industry. The second is the housing industry. In recent years, the construction industry has been thriving due to an increase in national and international investment to the extent that it is now the largest in the Middle East region. The Central Bank of Iran indicate that 70 percent of the Iranians own homes, with huge amounts of idle money entering the housing market. Iran has three shopping malls among the largest shopping malls in the world. Iran Mall is the largest shopping mall in the world, located in Tehran. The annual turnover in the construction industry amounts to US$38.4 billion. The real estate sector contributed to 5% of GDP in 2008. Statistics from March 2004 to March 2005 put the number of total Iranian households at 15.1 million and the total number of dwelling units at 13.5 million, signifying a demand for at least 5.1 million dwelling units. Every year there is a need for 750,000 additional units as young couples embark on married life. At present, 2000 units are being built every day although this needs to increase to 2740 units. Iran's construction market will expand to $154.4 billion in 2016 from $88.7 billion in 2013.
