Authored by the expert who managed and guided the team behind the Iran Property Pack
Everything you need to know before buying real estate is included in our Iran Property Pack
Buying a house in Iran requires understanding the diverse property market across major cities like Tehran, Shiraz, Isfahan, and Mashhad.
Property prices vary significantly based on location, property type, and size, with Tehran commanding the highest prices at $1,100-$1,500 per square meter as of mid-2025. Traditional houses with courtyards, modern apartments, and luxury villas offer different price points for various budgets and preferences.
If you want to go deeper, you can check our pack of documents related to the real estate market in Iran, based on reliable facts and data, not opinions or rumors.
Iran's housing market offers diverse options from traditional courtyard houses to modern apartments, with Tehran being the most expensive at $1,100-$1,500 per sqm, while cities like Isfahan and Mashhad offer more affordable alternatives at $700-$1,200 per sqm.
Total buying costs including taxes and fees typically add 4-7% to the property price, while mortgage options are available but often come with high interest rates that can exceed average income levels.
| City | Average Price per sqm (USD) | 50 sqm Property | 100 sqm Property | 200 sqm Property |
|---|---|---|---|---|
| Tehran | $1,100-$1,500 | $55,000-$75,000 | $110,000-$150,000 | $220,000-$300,000 |
| Shiraz | $1,200-$1,400 | $60,000-$70,000 | $120,000-$140,000 | $240,000-$280,000 |
| Isfahan | $1,200 | $60,000-$65,000 | $120,000-$130,000 | $240,000-$260,000 |
| Mashhad | $700-$900 | $35,000-$45,000 | $70,000-$90,000 | $140,000-$180,000 |
What types of houses or apartments are available in Iran and how do their prices differ?
Iran's residential market offers four main property types with distinct pricing structures and characteristics.
Traditional houses feature central courtyards or Persian gardens, multiple rooms, and are predominantly found in older neighborhoods and suburban areas. These properties are highly valued for their privacy and spacious layouts, typically commanding premium prices due to their cultural significance and larger land plots.
Modern houses blend traditional Iranian architectural elements with contemporary design features, often including yards or Persian gardens while incorporating modern amenities like updated kitchens and bathrooms. These properties are particularly popular among families seeking comfort and modern conveniences while maintaining cultural aesthetics.
Apartments represent the most common property type in urban centers, ranging from compact studios of 30-40 square meters to large family units exceeding 100 square meters. Apartments are available in both older complexes with basic amenities and new developments featuring modern facilities like elevators, parking, and security systems.
Luxury apartments and villas are concentrated in upscale neighborhoods, offering high-end finishes, advanced security systems, and premium amenities such as swimming pools, fitness centers, and concierge services.
How much does a typical house or apartment cost in Tehran compared to cities like Shiraz, Isfahan, or Mashhad?
Tehran commands the highest property prices in Iran, with average costs ranging from $1,100 to $1,475 per square meter as of mid-2025.
Luxury areas like Elahiyeh in northern Tehran reach $1,400 to $1,500+ per square meter, making them among the most expensive residential locations in the country. Central Tehran locations typically fall within the mid-range of this pricing spectrum.
Shiraz property prices average $1,200 to $1,400 per square meter in the city center, with suburban house prices around $1,400 per square meter. The city's growing infrastructure and cultural significance contribute to these relatively high valuations compared to other regional cities.
Isfahan city center apartments average approximately $1,200 per square meter, while suburban house prices drop significantly to around $700 per square meter. This substantial price difference between central and suburban areas makes Isfahan attractive for buyers seeking value outside the city core.
Mashhad offers the most affordable options among major Iranian cities, with city center apartment prices estimated at $700 to $900 per square meter, making it an attractive option for first-time buyers and investors seeking lower entry costs.
What are the price ranges for different surface areas, like 50 sqm, 100 sqm, and 200 sqm?
| City | 50 sqm Property | 100 sqm Property | 150 sqm Property | 200 sqm Property |
|---|---|---|---|---|
| Tehran | $55,000-$75,000 | $110,000-$150,000 | $165,000-$225,000 | $220,000-$300,000 |
| Shiraz | $60,000-$70,000 | $120,000-$140,000 | $180,000-$210,000 | $240,000-$280,000 |
| Isfahan | $60,000-$65,000 | $120,000-$130,000 | $180,000-$195,000 | $240,000-$260,000 |
| Mashhad | $35,000-$45,000 | $70,000-$90,000 | $105,000-$135,000 | $140,000-$180,000 |
| Karaj | $30,000-$40,000 | $60,000-$80,000 | $90,000-$120,000 | $120,000-$160,000 |
How much do you need to budget in total when buying a house, including taxes, agent fees, and other closing costs?
Total closing costs in Iran typically range from 4% to 7% of the property's purchase price, requiring careful budget planning beyond the property cost.
Agent fees constitute the largest portion of closing costs, typically ranging from 2% to 3% of the property value. These fees cover the real estate agent's services including property searches, negotiations, and transaction coordination.
Registration fees and taxes add approximately 1% to 2% of the property value to your total costs. These government-imposed fees are mandatory for legal property transfer and registration with local authorities.
Notary fees vary but generally represent a smaller percentage of the total transaction cost, covering document verification and legal authentication services required for property transfers.
For example, purchasing a $100,000 property would require an additional $4,000 to $7,000 in closing costs, bringing your total investment to $104,000 to $107,000. It's something we develop in our Iran property pack.
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How do mortgage options work in Iran and how much would a typical monthly payment be?
Iran's mortgage system offers conventional loans, government-insured programs, and specialized options for first-time buyers, though affordability remains a significant challenge.
Interest rates in Iran can be exceptionally high, with government loans offering rates up to 28% for long-term repayment periods. These elevated rates reflect the country's economic conditions and monetary policy constraints.
A typical government loan example involves borrowing 9.6 billion rials (approximately $19,200) over 12 years, resulting in monthly payments of about 200 million rials ($400). However, the average monthly salary in Iran is approximately 70 million rials ($140), making these payments challenging for most buyers.
Mortgage payments often exceed average incomes by significant margins, creating affordability barriers that prevent many Iranians from accessing homeownership. This income-to-payment ratio disparity has contributed to market stagnation in recent years.
Alternative financing options include family assistance, partnership arrangements, and rent-to-own agreements, which many buyers explore when traditional mortgages prove unaffordable.
What are some recent example prices for buying a home in both affordable and luxury neighborhoods?
Recent property transactions across Iran demonstrate the significant price variations between affordable and luxury market segments.
In affordable neighborhoods like southern and eastern Tehran, a 75 square meter apartment that's 30 years old costs approximately 30 billion rials ($38,400). These areas offer the most accessible entry points for first-time buyers and young families.
Luxury neighborhoods in Elahiyeh, northern Tehran, command premium prices exceeding $1,400 per square meter. A 100 square meter luxury apartment in this area would cost at least $140,000, featuring high-end finishes and premium building amenities.
In Shiraz, a three-bedroom downtown apartment of 80 square meters typically rents for $611 per month, with purchase prices around $96,000 based on the city's $1,200 per square meter average. This demonstrates relatively strong rental yields in regional cities.
Karaj offers some of the most affordable options near Tehran, with similar-sized properties costing 20-30% less than comparable Tehran properties while maintaining reasonable access to the capital's employment opportunities.
Luxury villas in affluent areas like Fereshteh Street in Tehran can exceed $200,000 for 150 square meter properties, representing the premium end of Iran's residential market.
Which neighborhoods are considered the most expensive, the most up-and-coming, and the most budget-friendly right now?
Iran's real estate market shows distinct geographic patterns with clear premium, emerging, and affordable segments across major cities.
Most Expensive Neighborhoods:
Elahiyeh and Fereshteh Street in northern Tehran represent Iran's most exclusive residential areas, with prices reaching $1,500 per square meter. These neighborhoods offer proximity to embassies, high-end shopping, and premium restaurants, attracting affluent buyers and expatriates.
Up-and-Coming Areas:
Karaj emerges as a prime growth area due to its affordability and proximity to Tehran, with rising demand from young professionals seeking value near the capital. Qom benefits from its status as a religious education hub with new residential developments attracting students and faculty. Shiraz continues growing due to infrastructure investments and its cultural tourism appeal, driving residential demand.
Budget-Friendly Options:
Southern and eastern Tehran districts offer the most affordable options within the capital, providing access to employment centers at lower costs. Karaj suburban areas present excellent value for families seeking larger properties with lower price points. Isfahan's suburban areas and smaller cities around major urban centers provide the most accessible homeownership opportunities for first-time buyers.
How have property prices in Iran changed over the past 5 years and in just the last year?
Iran's property market has experienced dramatic price increases over recent years, though demand has simultaneously declined creating market complexities.
Over the past five years, Tehran property prices have surged by approximately 1,700% from 2019 to 2024 according to some reports, though this figure reflects both nominal price increases and significant currency devaluation effects against the US dollar.
In the last year alone, Tehran prices rose from approximately $950 per square meter in September 2024 to over $1,100 per square meter by February 2025, representing a nearly 16% increase in just five months.
Despite these price increases, the market has entered what experts describe as "deep stagnation" with significantly reduced buyer demand. This paradox reflects affordability challenges where prices rise but fewer people can actually purchase properties.
Regional cities like Shiraz and Isfahan have experienced more moderate but still substantial increases, with prices rising 15-25% annually in recent years. These markets remain more accessible than Tehran while still experiencing inflationary pressures.
It's something we develop in our Iran property pack.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Iran versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
What are the forecasted housing market trends in Iran for the next 1, 5, and 10 years?
Iran's real estate market faces continued volatility in the short term with potential for long-term growth in select areas as of mid-2025.
Over the next 1-2 years, continued price volatility is expected due to ongoing inflation, currency devaluation, and economic uncertainty. Demand will likely remain subdued unless income levels rise significantly or prices stabilize at more affordable levels.
The 5-year outlook suggests potential stabilization as the market adjusts to affordability constraints, with growth likely concentrated in emerging cities like Karaj and Qom rather than premium Tehran locations. Infrastructure investments may drive demand in previously overlooked areas.
Long-term 10-year forecasts indicate potential for steady growth in urban centers with significant infrastructure investment, though this depends heavily on broader economic reforms and currency stabilization. Premium locations in Tehran and cultural cities like Shiraz are expected to maintain value better than secondary markets.
Emerging trends include growing interest in technology-enabled smart apartments, energy-efficient buildings, and suburban family homes as buyers prioritize value and modern amenities over pure location prestige.
The market outlook remains cautious due to persistent affordability issues and economic uncertainties, though long-term potential exists for investors with extended time horizons.
What are the smartest buying options if you plan to live there yourself versus renting out short-term or long-term?
Strategic property selection differs significantly based on whether you plan to occupy the property or generate rental income in Iran's current market.
Owner-Occupied Properties:
Focus on affordability, essential amenities, and proximity to employment centers or schools. Suburban areas in Karaj, Isfahan, and emerging neighborhoods offer better value for families seeking long-term residence. Consider transportation links and future infrastructure development when selecting locations outside city centers.
Long-Term Rental Investment:
Target areas with consistent demand such as locations near universities, business districts, and major employment centers. Tehran's mid-range neighborhoods and Shiraz's central areas offer strong rental yields with lower tenant turnover. Focus on properties with modern amenities that attract stable, long-term tenants.
Short-Term Rental Investment:
Luxury apartments in Tehran's northern districts and tourist-friendly areas in cultural cities like Shiraz and Isfahan present opportunities, though regulatory considerations and tourist volume fluctuations require careful analysis.
Best Return Strategies:
Up-and-coming cities like Karaj, Qom, and suburban Shiraz offer the best combination of affordability and growth potential. Areas with planned infrastructure development or educational institution expansion provide long-term appreciation opportunities while maintaining reasonable entry costs.
What kind of returns can you expect if you buy now and resell later — and where are the best places for that?
Real estate investment returns in Iran historically provide inflation hedging but face current market complexities requiring careful location and timing decisions.
Historically, Iranian real estate has served as an effective hedge against inflation, though recent years have seen speculative bubbles and market stagnation creating uncertainty. Long-term growth potential remains in prime locations, but short-term gains are highly unpredictable.
Best locations for resale potential include Elahiyeh in Tehran for luxury market stability, Karaj for emerging market growth, and Qom for educational sector expansion. Shiraz offers cultural tourism appeal with steady appreciation potential over extended holding periods.
Infrastructure development areas present the strongest appreciation potential, particularly locations near planned metro extensions, new highway connections, or major commercial developments. These areas often offer 20-30% appreciation potential over 3-5 year periods.
Current market conditions suggest 5-10 year holding periods may be optimal for realizing significant returns, as short-term market volatility and reduced buyer demand limit quick resale opportunities.
Investment success requires focusing on properties with modern amenities, good locations, and reasonable purchase prices rather than expecting rapid appreciation in the current stagnant market environment. It's something we develop in our Iran property pack.
How do home prices in Iran compare with other major cities in the region like Istanbul, Cairo, or Karachi?
| City | Average Price per sqm (USD) | Relative Affordability | Market Characteristics |
|---|---|---|---|
| Tehran, Iran | $1,100-$1,500 | Moderate-High | Volatile, inflation-driven growth |
| Istanbul, Turkey | $1,000-$2,500 | High | Established international market |
| Cairo, Egypt | $800-$1,500 | Moderate | New Cairo commands premium |
| Karachi, Pakistan | $500-$1,000 | Low-Moderate | Wide variation by district |
| Shiraz, Iran | $1,200-$1,400 | Moderate | Cultural significance premium |
| Isfahan, Iran | $1,200 | Moderate | Historical city appeal |
| Mashhad, Iran | $700-$900 | Low-Moderate | Religious center with growth |
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Iran's housing market presents a polarized landscape with significant opportunities for informed buyers and investors.
Tehran remains the most expensive market while cities like Karaj, Mashhad, and suburban areas offer better value propositions, though all locations face affordability challenges due to high prices relative to local incomes.
Sources
- TapPersia - Apartment vs House Life in Iran
- Statista - Iran Residential Real Estate Outlook
- Tehran Offers - Elahiyeh Neighborhood
- Iran Focus - Tehran Housing Price Surge
- Iran International - Housing Market Report
- Living Cost - Isfahan vs Shiraz Comparison
- Sands of Wealth - Iran Area Guide
- Global Property Guide - Transaction Costs
- Tehran Times - Iranian Mortgage Options
- Iran Focus - Home Ownership Challenges