How much is a house in Iran in Iranian Rial?

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

Who is the author of this content?

SANDSOFWEALTH

A team specialized in real estate investing in MENA countries (Iran, UAE, Turkey, Egypt, etc.).

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Iran. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At SandsOfWealth, we explore the Iranian real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Tehran, Isfahan, and Shiraz. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

What types of properties are available in Iran?

Iran's real estate market offers four main property types for buyers and investors.

Apartments dominate the market, particularly in major cities like Tehran, Shiraz, and Mashhad. These range from compact studios of 30-40 square meters to luxury penthouses exceeding 200 square meters in premium neighborhoods.

Houses, including detached and semi-detached homes, are more common in suburban areas and smaller cities. Traditional Persian houses with courtyards remain popular in historical districts, while modern villas with gardens attract affluent buyers in northern Tehran and other upscale areas.

Villas represent the luxury segment, typically found in affluent neighborhoods like Elahieh, Zafaraniyeh, and Niavaran in Tehran. These properties often feature private pools, gardens, and high-end amenities, commanding premium prices above 1.2 billion rials per square meter.

Land ownership presents restrictions for foreign buyers, as Iranian law generally prohibits foreign ownership of land, though buildings on leasehold land are permitted with proper approvals.

Which areas in Iran are most expensive, affordable, or emerging?

Tehran's elite neighborhoods command the highest property prices in Iran as of June 2025.

The most expensive areas include Elahieh, Zafaraniyeh, Niavaran, and Farmanieh in northern Tehran, where luxury apartments reach 1.2-1.5 billion rials per square meter. Jordan, Mirdamad, and Pasdaran also rank among premium neighborhoods with prices exceeding 1 billion rials per square meter.

Budget-friendly options exist in Tehran's southern districts (15, 16, 17, 18, 19, and 20), where prices drop to 400-600 million rials per square meter. Karaj emerges as an affordable alternative, offering properties at 320-480 million rials per square meter while maintaining good connectivity to Tehran.

Up-and-coming areas show strong growth potential. Karaj benefits from rapid population growth and increased property sales due to its affordability and proximity to Tehran. Kerman experiences a real estate boom driven by mining industry expansion and worker migration.

Secondary cities like Shiraz, Mashhad, and Isfahan offer more affordable alternatives with prices ranging from 380-650 million rials per square meter, making them attractive for first-time buyers and investors seeking rental income opportunities.

How much do properties cost in major Iranian cities?

Property prices in Iran's major cities vary significantly based on location and property type as of mid-2025.

City	Property Type	Price (Million Rials/sqm)
Tehran (Elite)	Luxury Apartment	1,200-1,500
Tehran (Central)	Standard Apartment	750-950
Tehran (South)	Budget Apartment	400-600
Shiraz	Apartment	450-650
Shiraz	House	380-580
Mashhad	Apartment	380-580
Karaj	Apartment	320-480

What are the average prices per square meter across different areas?

Average property prices per square meter in Iran show significant regional variations as of June 2025.

Tehran leads with the highest prices, averaging 880 million rials per square meter citywide according to Central Bank data. Elite neighborhoods like Elahieh command premiums of 1.2-1.5 billion rials per square meter, while southern districts offer more affordable options at 400-600 million rials.

Shiraz averages 450-650 million rials per square meter for apartments and 380-580 million rials for houses in central areas. New developments in prime locations reach the higher end of this range, while older properties in peripheral areas price at the lower end.

Mashhad properties average 380-580 million rials per square meter, with central locations commanding premium prices. Religious tourism and pilgrimage traffic support steady demand in this holy city.

Karaj offers the best value proposition at 320-480 million rials per square meter, attracting commuters and first-time buyers seeking affordability with reasonable access to Tehran's employment centers.

What additional costs should buyers expect beyond the purchase price?

Iranian property transactions involve several additional costs beyond the advertised purchase price.

Real estate agency fees typically range from 3-5% of the property value, usually paid by the seller but sometimes negotiated between parties. Registration fees amount to 0.5% of the property value, paid by the buyer to officially register the transaction.

Transfer taxes vary significantly: 5% of transaction value for existing buildings and 15% for new buildings, though the paying party depends on contract negotiations. Legal and notary fees vary based on transaction complexity but typically add 1-2% to total costs.

Capital gains tax was eliminated for real estate sales as of 2020, providing tax relief for property investors. However, rental income tax applies to landlords, with exemptions for residential leases up to 150 square meters in Tehran and 200 square meters elsewhere.

It's something we develop in our Iran property pack.

Can foreigners legally purchase property in Iran?

Foreign property ownership in Iran faces significant legal restrictions and limitations.

Foreigners cannot own land directly in Iran under current law. However, they can own buildings constructed on leasehold land, subject to approval from the Ministry of Foreign Affairs. This process requires extensive documentation and government review.

Property purchases by foreigners must use their own funds, as Iranian banks generally do not provide mortgages to non-residents. This cash requirement significantly limits foreign investment in the market.

Additional scrutiny and paperwork apply to foreign buyers, though specific extra costs beyond standard transaction fees are minimal. The approval process can extend transaction timelines by several months compared to domestic purchases.

Investment opportunities exist for foreigners despite restrictions, particularly in commercial real estate and joint ventures with Iranian partners. Legal consultation is essential for foreign buyers to navigate complex regulations and ensure compliance.

How do Iranian mortgage options work?

Iranian mortgage markets operate under Islamic banking principles with unique characteristics compared to conventional financing.

Mortgages are available to Iranian nationals through various Islamic banking products including Murabaha (cost-plus financing) and Ijarah (lease-to-own) structures. Interest rates are high by international standards, ranging from 22-30% annually as of mid-2025.

Loan terms typically extend up to 20 years, with down payments often requiring 30-50% of property value. Eligibility depends on income verification, credit history, and debt-to-income ratios, with banks requiring detailed financial documentation.

Government-backed housing programs occasionally offer subsidized rates for eligible first-time buyers, though these programs face budget constraints and limited availability. The National Housing Movement aims to provide affordable financing options for low-income families.

Foreign buyers cannot access Iranian mortgage financing and must purchase properties with cash, presenting a significant barrier to international investment in the residential market.

How have Iranian housing prices changed over time?

Iranian housing prices have experienced dramatic increases over the past five years, driven by economic challenges and currency devaluation.

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 real examples of recent property sales in Iran?

Recent property transactions in Iran demonstrate the current market reality across different cities and property types.

Tehran's luxury market shows strong activity despite high prices. A 120-square-meter apartment in Elahieh recently sold for 180 billion rials (approximately $285,000), reflecting the premium commanded by elite neighborhoods. A 100-square-meter unit in Jordan neighborhood traded for 95 billion rials ($150,000).

Shiraz transactions reveal more affordable options for buyers. A two-bedroom apartment of 55 square meters in central Shiraz sold for 35 billion rials ($55,000), while a 100-square-meter house in a suburban area traded for 58 billion rials ($92,000).

Karaj offers the best value for money, with a 90-square-meter apartment recently selling for 32 billion rials ($50,000), attracting buyers seeking affordability with Tehran access. A 120-square-meter house in Karaj traded for 45 billion rials ($71,000).

Mashhad's religious tourism market supports steady demand, with a 80-square-meter apartment near the holy shrine selling for 42 billion rials ($66,000), demonstrating the location premium for tourist-accessible properties.

What are the optimal investment strategies for Iranian real estate?

Iranian real estate investment strategies should align with market conditions and investor capabilities as of mid-2025.

Buying to live suits long-term residents and Iranian nationals seeking stability amid economic uncertainty. Primary residence purchases offer protection against inflation and currency devaluation, though high prices challenge affordability for most buyers.

Long-term rental strategies work well in high-demand areas like Tehran, Shiraz, and Mashhad. Rental yields of 4.3-7.0% provide attractive returns, especially for properties in university areas, business districts, and tourist zones. Government rent control measures limit increases to 25% annually in Tehran.

Short-term rental opportunities exist in tourist destinations, though regulatory restrictions and market volatility require careful consideration. Religious tourism in Mashhad and cultural tourism in Shiraz support demand for furnished accommodations.

Property flipping strategies carry high risks due to transaction costs, market volatility, and economic uncertainty. Successful flippers focus on undervalued properties in emerging neighborhoods like Karaj or Kerman, where infrastructure improvements drive appreciation.

It's something we develop in our Iran property pack.

What are the smartest property choices for different investment goals?

Optimal property selection in Iran varies significantly based on investment objectives and risk tolerance.

Value appreciation investments should focus on emerging areas like Karaj, Kerman, and select Tehran neighborhoods undergoing urban regeneration. Properties in these areas offer potential for capital gains as infrastructure improvements and economic development drive demand.

Rental income seekers should target properties in stable, high-demand areas. Tehran's central districts, university neighborhoods in Shiraz, and pilgrimage areas in Mashhad provide consistent rental demand. Smaller apartments (50-80 square meters) generate higher yields relative to purchase price.

Livability-focused buyers should prioritize established neighborhoods with good infrastructure, schools, and amenities. Northern Tehran districts, central Shiraz, and quality areas in Mashhad offer the best combination of convenience and lifestyle quality.

Risk-averse investors may prefer diversified approaches, combining rental income properties in stable areas with small positions in emerging markets. This strategy balances current returns with growth potential while managing exposure to market volatility.

How do Iranian property prices compare regionally?

Iranian property prices show competitive positioning compared to regional markets when adjusted for local economic conditions.

Relative to neighboring countries, Iranian properties offer lower absolute prices than UAE, Turkey, or Qatar markets. However, local purchasing power considerations reveal different affordability metrics for domestic buyers.

Tehran's price-to-income ratio of approximately 19.7 indicates relatively expensive properties compared to local wages, ranking Iran 15th globally in property price indexes. This suggests properties are overvalued relative to local economic fundamentals.

Rental yields in Iran (4.3-7.0%) exceed those in many regional markets, making Iranian properties attractive for international investors seeking income generation. These yields compare favorably to Dubai (3-5%) and Istanbul (4-6%) markets.

Currency volatility adds complexity to regional comparisons, as rial depreciation affects dollar-denominated valuations. Properties serve as inflation hedges for local buyers but present currency risks for international investors.

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.

Sources

1. 9 statistics for the Iran real estate market in 2025 – Sands Of Wealth
2. Average Housing Price in Tehran at 830 million Rials - Iran Focus
3. Property prices will fall in Tehran in 2025 – Sands Of Wealth
4. Half of Tehran residents can never own a home | Iran International
5. Residential Real Estate - Iran | Statista Market Forecast
6. Price of Housing in Tehran At $1,340 Per Square Meter - Iran Focus
7. Iran's Statistics Center Reports Housing Inflation After Months Of Silence | Iran International
8. Property Prices in Iran - Numbeo