Housing Costs in Iran Twice as High as in Europe
Rokna Economic Desk: The share of housing expenses in Iran, including rent and mortgage payments, has risen to nearly double the European average, creating severe financial pressure on Iranian households. According to international affordability standards, housing costs should not exceed 30 percent of a household’s income; otherwise, housing is considered unaffordable.
The European Union measures housing affordability through an indicator known as the “housing cost overburden rate,” which reflects the proportion of households spending more than 40 percent of their disposable income on housing. On average, about 10 percent of urban households in the EU fall into this category.
According to data from Iran’s Statistical Center for 2023–2024 (Iranian year 1402), housing expenses accounted for about 42 percent of the total household consumption basket across the country. In comparison, the average housing cost share in the EU stands at just 20 percent of household income. This indicates that Iranian families are bearing a much heavier housing burden, depriving many of affordable and stable living conditions.
Economic experts warn that escalating housing costs not only reduce household purchasing power but also have a direct social impact, particularly by discouraging marriage among young people. In Europe, concerns about housing affordability have become a central social issue. In some countries, nearly one-third of urban residents spend more than 40 percent of their income on housing.
Over the past decade, housing prices and rents across the EU have surged far faster than income growth. This trend has placed the greatest strain on middle-income and younger populations, sparking protests in major cities such as Madrid, Berlin, and Lisbon.
According to Eurostat data, by 2024, 9.8 percent of EU households living in cities were spending over 40 percent of their disposable income on housing. The rate was particularly high in Greece, where nearly one-third of urban households faced such burdens, compared with only 2.3 percent in Cyprus. Between 2015 and 2024, housing prices in the EU rose by an average of 53 percent.
The contrast with Iran’s 42 percent share of housing costs highlights the severity of the country’s housing crisis. The data suggest that a large segment of the population has been priced out of affordable housing, with significant implications for Iran’s economic stability and social cohesion.
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