All sources have been thoroughly verified for credibility. Furthermore, a local real estate expert has reviewed and approved the final article.
Yes, the analysis of Tehran's property market is included in our pack
Thinking of buying a property in Tehran? You're not alone!
Many people are fascinated by Tehran's rich history and dream of owning a modern apartment or a stylish townhouse there.
Does it make sense, though? Are property prices increasing in Tehran? Is it expensive? Should I buy property in the city center or northern suburbs? What are the taxes? Where are the best yields?
We have the answers.
The SandsOfWealth team has done their homework and know this market well. As a matter of fact, we've compiled all our findings in one pack. Get it now.
In the lines below, we will share some of this knowledge.
How's the real estate market in Tehran?
Is the property market going up or down? Opinions vary. As for us, we don’t listen to rumors. We use up-to-date data and statistics, to ensure our conclusions are well-founded.
Property types
In Tehran, you can find various types of properties for sale, including apartments, houses, villas, and commercial spaces.
Apartments are commonly available in different sizes, ranging from single-bedroom units to larger penthouses. Houses and villas offer more space and often come with gardens or yards.
Commercial properties include shops, offices, and warehouses, suitable for business ventures.
The city offers a diverse range of properties to meet different preferences and needs.
Should you buy or rent?
(If you're keeping it for yourself and not renting it)
If Tehran is your city of choice, you may be thinking about the advantages of buying versus renting a property in this bustling Iranian capital.
Without a doubt, you should buy if you want to acquire equity and gain long-term financial security in the Tehran real estate market.
To make a good decision, consider the property price-to-rent ratio. It's like a measure of how much rental income you'll need to afford the property at its current value.
According to Numbeo, the property price-to-rent ratio in Tehran is around 17.35, which is around the world average.
In simple terms, it would typically require 17 years of rental payments, on average, to buy a property in Tehran.
Housing prices in Tehran
On average, according to the last reported data from Statistical Center of Iran, purchasing a property in Tehran would cost you around $2,630 per square meter.
Naturally, property prices are quite spread out. A luxury apartment in northern Tehran may have a higher price per square meter than an apartment in central Tehran. We actually give you a more detailed breakdown in our pack for buying property in Tehran and in Iran.
To put things in perspective, it is 7 times less than the property prices in the center of New York.
Also, housing prices in Tehran are similar to the prices in Istanbul.
The most expensive neighbourhoods in Tehran are probably in the northern and western areas of the city, such as Vanak, Zafaraniyeh and Farmanieh, while the cheapest areas are likely to be in the south and east of the city, such as Shahr-e-Rey, Pardisan and Shahr-e-Qods.
Trends
First and foremost, we have to acknowledge that Iran is, today, not a stable country. The last Fragile State Index that has been reported for this place is 84.1.
Don't overlook this when weighing the advantages and disadvantages of buying a property in Tehran.
On the longer term, the growth will still be there since Iran's economy is expected to soar by 9.5% in the coming 5 years, resulting in an average GDP growth rate of 1.9%.
If you intend to invest in real estate in Tehran it's a good thing because when the economy grows, people tend to become wealthier, which usually results in higher housing prices.
Also, in Iran, the average GDP per capita has changed by 4.6% over the last 5 years. The growth, although minimal, is still present.
This trend can lead to a rise of property prices in Tehran over the course of 2024 and also later on.
Looking for more updated data? We've done a big-picture study to find out if it's a good idea to purchase property in Iran right now.
Buying property in Tehran
Buying real estate in Tehran can be a difficult process due to the lack of reliable and up-to-date information. That's why we have created the pack to buy property in Tehran and in Iran.
Buying process
In our pack, we've explained the entire buying process in detail. We've provided clear information about prices and yields based on the area, guidance on negotiating the price, and options for securing a mortgage.
Now, we're offering you a simpler version, step-by-step, to make it easier for you to grasp.
This is the step-by-step process to purchase a property in Tehran:
- Determine budget and preferences for a property in Tehran.
- Engage a local real estate agent familiar with the city's regulations.
- Review property listings and visit potential properties in Tehran's neighborhoods.
- Conduct due diligence, including verifying ownership documents and checking for any encumbrances.
- Negotiate the price and terms with the seller, considering local market trends.
- Sign a Letter of Intent (LoI) or Purchase Agreement, outlining conditions and contingencies.
- Obtain the "Title Deed" (Sana'ati) and "Possession Letter" (Gharardad-e-Hasb) from the seller.
- Hire a lawyer experienced in Iranian property law to review the legal aspects.
- Secure funding or obtain a mortgage through local financial institutions.
- Transfer funds to the seller's account using Iran's banking system.
- Register the property with the local Land Registration Office (Tapu), which issues the "Title Deed" (Sana'ati).
- Receive the "Title Deed" (Sana'ati) and complete the transaction, officially becoming the property owner in Tehran.
Also, if you're not from the country, you might want to check our article on how to buy property as a foreigner in Iran.
Make a profitable investment in Tehran
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Where to find a property
Discover properties in Tehran with the help of these websites:
- 4321 Property - Online platform for buying and selling properties in Iran, offering a wide range of houses, apartments, land, and businesses for sale.
- Realigro - Real estate search engine specializing in properties for sale in Iran, providing listings, market trends, and statistics for buyers and sellers.
- Expat - Online platform providing housing-related services for expatriates in Iran, including buying, selling, and renting properties.
- ITradeProperty - Platform offering property listings in Iran, allowing users to buy, sell, and rent various types of properties.
Also, know that we have included contacts of real estate agencies, property lawyers, moving companies, expats communities and more in our pack for buying property in Iran.
Which properties for which budget?
As mentioned before, the average price per sqm in Tehran is $2,630. A 1-bedroom property with 60 square meters of space would cost approximately $158,000, while a 2-bedroom with 85 square meters of space would be around $224,000.
However, as you can guess, property prices will differ based on the attributes of the property and its specific location.
Expect property prices to be on the higher side in the premium areas of Tehran. A condominium in Niavaran could come to around $300,000, but a residence in Sa'adat Abad might be priced at $590,000.
Yet, there are places that are easier on the wallet. You might discover a property in District 12 for $120,000, or you could find a property in District 13 priced at $100,000.
Find a more detailed breakdown in our full pack for buying property in Iran.
Risks and pitfalls
Here are the main pitfalls specific to buying a property in Tehran, Iran:
- Land ownership limitations for foreign nationals can restrict property options.
- Complex Islamic inheritance laws may affect property transfers and inheritance rights.
- Possibility of properties being affected by sanctions or geopolitical tensions.
- Limited availability of mortgage options for foreigners may require full upfront payments.
- Variable rules and restrictions on property usage based on religious or cultural factors.
- Potential exposure to currency exchange risks if repatriating funds later.
- Risk of property confiscation due to violations of Sharia law or government regulations.
- Difficulty in accessing reliable property data, making accurate valuations challenging.
We don't want this to happen to you, so we have included a full checklist for your property investment in our pack of documents. Avoid these mistakes and save a lot of money.
Everything you need to know is included in our Iran Property Pack
Living in Tehran
Living in Tehran can be an exciting and rewarding experience, with a vibrant culture and plenty of opportunities for both entertainment and investment.
Cost of living
The cost of living in Tehran is relatively low compared to other major cities in the world. Basic necessities such as food, transportation, and rent are relatively affordable, while luxury items can be more expensive.
Here are some examples to better understand the cost of living in Tehran, Iran:
- Doogh (Persian yogurt drink): $1 at a local restaurant.
- Rent for a one-bedroom apartment in Saadat Abad neighborhood: $800/month.
- Chelo Kabab (Iranian dish) for two at a local eatery: $30.
- 1.5-liter bottle of Zamzam Cola: $1 at a supermarket.
- Electricity bill for an 85m² apartment using Tavanir (Iran Power Generation, Transmission, and Distribution Management Company): $50/month.
- Monthly membership at Alborz Sports Club: $50.
- Ticket to a movie at Cineplex in Palladium Mall: $8.
- Cup of traditional Iranian saffron tea at a tea house: $2.
Neighbourhoods
Since we want to present information in a clear and reader-friendly way, we've created a summary table outlining the various neighborhoods in Tehran. For yields, prices and rents, check our property pack.
| Neighborhood | Description | Strengths | Weaknesses |
|---|---|---|---|
Tajrish | Tajrish is a bustling neighborhood located in the northern part of Tehran, known for its vibrant bazaar, recreational parks, and proximity to the Alborz mountains. | Rich cultural attractions, diverse shopping options, beautiful natural surroundings. | Heavy traffic, higher living costs. |
Valiasr | Valiasr is one of the longest and busiest avenues in Tehran, lined with shops, restaurants, and historical landmarks. | Major commercial hub, great transportation links, historic sites. | High levels of pollution, crowded streets. |
Saadat Abad | Saadat Abad is a modern residential neighborhood with many high-rise buildings, shopping centers, and recreational facilities. | Modern infrastructure, plenty of amenities, good schools. | Dense population, limited green spaces. |
Darakeh | Darakeh is a charming neighborhood nestled at the foothills of the Alborz mountains, popular for its hiking trails and traditional teahouses. | Natural beauty, outdoor activities, traditional ambiance. | Limited public transportation, some areas may lack proper infrastructure. |
Vanak | Vanak is a well-developed district known for its upscale residential areas, shopping malls, and entertainment centers. | High-end housing options, great shopping opportunities, vibrant nightlife. | Higher cost of living, traffic congestion during peak hours. |
Gholhak | Gholhak is a calm and affluent neighborhood with luxurious residential properties and proximity to cultural venues. | Exclusive residential area, cultural attractions nearby. | Expensive housing, limited affordable options. |
Darband | Darband is a popular mountain resort area offering hiking trails, restaurants, and a lively atmosphere, attracting locals and tourists alike. | Natural beauty, recreational opportunities, vibrant ambiance. | Heavy tourist traffic, limited parking. |
Shemiran | Shemiran is a leafy and affluent residential area known for its grand mansions, beautiful gardens, and pleasant climate. | Elegant neighborhoods, lush greenery, cooler weather. | Higher cost of living, limited public transportation. |
Park-e Shahr | Park-e Shahr, also known as City Park, is a large public park in the heart of Tehran, offering recreational facilities and green spaces for relaxation. | Central park, family-friendly environment, various leisure activities. | Crowded during weekends and holidays. |
Enghelab | Enghelab is a central district known for its historical landmarks, universities, and vibrant street life. | Rich cultural heritage, educational institutions, lively atmosphere. | Heavy traffic, limited green spaces. |
Sa'adabad | Sa'adabad is home to the Sa'adabad Palace Complex, a former royal residence turned museum and park, attracting visitors with its history and beautiful gardens. | Royal heritage, cultural sites, lush greenery. | Some areas may be restricted due to being part of the palace complex. |
Shahrak-e Gharb | Shahrak-e Gharb is a modern and planned residential area, offering well-designed apartment complexes, shopping centers, and recreational facilities. | Modern infrastructure, good amenities, family-friendly environment. | Limited green spaces, traffic congestion during rush hours. |
Iran Zamin | Iran Zamin is a suburban area known for its spacious residential properties, calm atmosphere, and proximity to nature. | Quiet surroundings, larger homes, access to green areas. | Less developed infrastructure, longer commute to the city center. |
Jamaran | Jamaran is an upscale neighborhood, home to the Jamaran Complex, the former residence of Ayatollah Khomeini, and now a religious and cultural center. | Historical significance, religious importance, serene environment. | Some areas may have restricted access due to religious sites. |
Tehranpars | Tehranpars is a densely populated area with various shopping centers, restaurants, and recreational facilities. | Commercial activity, diverse amenities, affordable housing options. | High population density, traffic congestion. |
Evin | Evin is home to Evin Prison, a notorious facility, but it also has residential areas known for their beautiful views and pleasant climate. | Scenic views, peaceful atmosphere, good weather. | Proximity to the prison, limited commercial activity. |
Ekbatan | Ekbatan is a large residential complex with multiple high-rise buildings, offering a self-contained community with various facilities. | Complete neighborhood, plenty of amenities, affordable housing. | Some areas may feel congested, limited green spaces. |
Resalat | Resalat is a central district with a mix of commercial and residential areas, known for its accessibility and bustling atmosphere. | Convenient location, diverse businesses, good transportation. | Heavy traffic, crowded streets. |
Life in Tehran
The economy of Tehran is largely driven by the services sector, which accounts for nearly two-thirds of the city's GDP. Tehran also has a large industrial sector, which is mainly composed of manufacturing, construction, and mining activities.
What expats usually like the most in Tehran is the vibrant atmosphere of the city, with its bustling bazaars and lively cafes, as well as its rich cultural heritage.
You have to know that Tehran is not the safest city in the world. Currently, the crime rate index is at 56, which is not low. The most common crimes in Tehran are theft, pickpocketing, robbery, and burglary.
A good point for a property investor - Tehran has an extensive mass rapid transit system consisting of metro, bus, and suburban railway lines.
Access to healthcare in Tehran is good, with a Healthcare Index of 53. An effective healthcare infrastructure always boost the appeal of a place, which is good for real estate.
Finally, it is worth noting that the Sharif University of Technology ranks among the top 500 universities in the world.
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Renting out in Tehran
If your intention is to buy a property not for personal use, but to rent it out and create income, then this section is for you.
Long-term
Tenant Profiles in Tehran
According to the data reported by Wikipedia, the home ownership rate in Iran is 61%, which is not much.
It means that, if you decide to buy and rent out in Tehran, there will be a lot of people who can become your potential tenants.
If you decide to buy and rent out to long-term tenants, you should target young professionals, students, expats, and families. There is also a lot of demand from tourists and business travelers looking for short-term rentals.
Here is a little summary table we've made for you.
| Property type and area | Profiles of potential tenants | What they are looking for | Expected monthly rent in $ |
|---|---|---|---|
Apartment in Tajrish | Local residents, families | Proximity to shops, parks | $300 - $800 |
Condo in Saadat Abad | Young professionals | Modern amenities, city access | $800 - $1500 |
Villa in Niavaran | Affluent families, expats | Luxury living, spacious | $2000 - $5000 |
Apartment in Shahrak Gharb | Young professionals | Modern complex, close to metro | $600 - $1200 |
House in Vanak Square | Families, expats | Central location, spacious | $1500 - $3000 |
Apartment in Valiasr | Students, young professionals | Close to universities, affordable | $400 - $1000 |
Condo in Pardis | Local residents, families | Suburban living, green areas | $400 - $800 |
Rental yields
Nowadays, the rental yields you get in Tehran are between 5% and 7%. There are some opportunities. So you know, a "good" rental yield is above 7%.
Rental yields in Tehran are typically highest for properties located in the city center, as these locations are most desirable for tenants due to their proximity to major businesses, shopping centers, and transportation options. Additionally, rental yields in Tehran are often higher for larger properties, such as multi-family homes and apartment buildings, as there is more potential to rent out multiple units at once.
For further explanation and a more detailed breakdown, you can check the reports and analyses we have made.
Short-term
You could also decide to rent short-term to business travelers, tourists, and students visiting Tehran for a short period of time. Additionally, you could rent to those who are relocating to Tehran and need a short-term place to stay while they search for a more permanent residence.
If you decide to go with that option, look for properties in the affluent neighborhoods of North Tehran, such as Elahieh, Farmanieh, and Zafaraniyeh. Also, check out the more central areas of Vali-e Asr and Tajrish for high rental demand.
Is it worth buying real estate in Tehran then?
Certainly, when it comes to buying property in Tehran, it's essential to cut through the complexities and make a clear decision based on your circumstances.
If you plan to establish a long-term residence in Tehran and can afford the upfront costs, buying a property can be a wise move. The property price-to-rent ratio in Tehran is reasonable, suggesting that over time, you can build equity and potentially benefit from rising property values in a growing economy. Investing in real estate in Tehran can be a smart choice, as Iran's economy is expected to expand in the coming years, which often leads to higher housing prices. Furthermore, renting out the property to a diverse range of potential tenants can provide a steady income stream.
On the flip side, if your stay in Tehran is short-term or you're concerned about foreign ownership restrictions, geopolitical risks, or limited mortgage options for foreigners, renting may be a more practical choice. Renting offers flexibility and avoids the significant upfront expenses associated with buying property. It also sidesteps the complexities of property ownership in a foreign market. Moreover, currency exchange risks and the challenge of obtaining reliable property data in Tehran can add uncertainties to the investment landscape.
Ultimately, whether buying a property in Tehran is worth it depends on your goals, financial situation, and willingness to navigate the unique challenges of the Iranian real estate market. It's essential to weigh the pros and cons carefully and seek local expertise to make a well-informed decision.
Make sure you understand the real estate market in Tehran
Don't rush into buying the wrong property in Iran. Sit, relax and read our guide to avoid costly mistakes and make the best investment possible.
The content provided here is for informational purposes only and does not imply endorsement or advice. While we strive for accuracy, we do not guarantee the completeness or reliability of the information, including text, images, links, or other elements in this material. Following the content and analyses presented here does not assure specific outcomes. For guidance tailored to your individual circumstances, it is recommended to consult with a professional, such as a lawyer, accountant, or business advisor.