Above: Modern residential blocks of low income public housing built in Borujerd, Iran
(Photo: Wikipedia Commons)
According to Tehran Times:
The transport and urban development minister announced [last] Wednesday that the Mehr housing plan will not continue in the new administration of Hassan Rouhani.
Abbas Ahmad Akhoundi said his ministry will “only complete” the unfinished Mehr housing projects.
The completion of 1.5 million houses in 17 new cities is a legacy of the Mahmoud Ahmadinejad administration for the new administration. The plan started in 2007.
The plan is a home construction promotion program in which the government offers developers free land in return for the construction of cheap residential units for first-time house buyers on 99-year leases. Under the scheme, the government commissions banks as agents to offer loans to the real estate developers.
The minister said the project has created problems for the government and the applicants and is not a “good plan” to be continued.
In late August Ali Tayebnia, the minister of economy and finance, blamed the Mehr housing plan for over-expanding money supply. He also blamed the Mehr housing policies for runaway inflation and serious budget problems.
Officials in the new administration had initially said that the Mehr houses serve as dormitories and it was better that these houses were being built in cities.Not long ago Iran's media began running pictorials on public housing new construction deficiencies, so this announcement was expected.
With reduced government revenue as a result of U.S.-led economic sanctions against Iran, the public housing program couldn't be sustained.
Iran's media has been depicting this development as being in the interest of low income applicants but one has to imagine there are families in line for public housing that are disappointed with the cancelation of the program.