The individual loan ceiling for the National Housing Movement (Nehzat e Melli e Maskan), Iran's flagship state backed housing scheme, has risen from 6.5 billion rials to 8.5 billion rials, that is from 650 to 850 million tomans. The increase was approved at the 24th session of the Supreme Housing Council on 26 May 2026, chaired by the first vice president, and subsequently ratified at the 71st session of the Central Bank of Iran's High Council (Mehr News Agency, 29 July 2026; Eghtesad Online citing IRIB, 30 July 2026).
On Sunday, 2 August 2026, however, that same figure was challenged from inside parliament. Habib Ghasemi, a member of the Construction Committee and of the presiding board of the Article 90 Committee, said 850 million tomans is "by no means responsive to applicants' needs" and that, measured against the finished cost per square meter, it should have reached roughly 1.5 to 2 billion tomans (Khaneh Mellat, parliament's news agency, as reported by EcoIran, 2 August 2026).
One point gets lost in the headlines: this is not a general home purchase loan. Under the Central Bank High Council's decision, the higher ceiling applies solely to supported housing projects whose land is supplied by the Roads and Urban Development Ministry and allocated to applicants, and it was additionally extended to projects that are more than 65 percent physically complete.
Background: the loan rose 70 percent, build costs several times that
To judge the size of this number you have to go back to the starting point. According to the same committee member, when the Housing Production Leap Law was first passed the loan was set at 500 million tomans, at a time when the average finished cost of a square meter of housing was "under 10 million tomans." Today, again by his estimate, the average finished construction cost per square meter, excluding the price of land, is more than 25 to 30 million tomans.
Putting those two figures side by side is the anchor of the story: the loan ceiling going from 500 to 850 million tomans is roughly 70 percent growth, while the build cost per square meter rose at least 150 to 200 percent over the same span. The loan grew, but at less than half the speed of the cost it is meant to cover.
A second estimate sits on the table, and it comes from elsewhere. Farshid Pourhajat, secretary of the National Association of Mass Builders, told Mehr News Agency (26 July 2026) that the average cost of building a five storey building in Iran has reached about 60 million tomans per square meter, roughly 70 percent higher than a year earlier. The gap with the 25 to 30 million estimate is not accidental: one is a national average excluding land, the other the real cost of a specific, more fully equipped project. Separately, both say the same thing: construction costs have jumped about 70 percent in a single year.
The key numbers, as of 2 August 2026
| Measure | Figure | Source |
|---|
| Individual National Housing Movement loan ceiling | 850 million tomans (8.5 billion rials), previously 650 million | Central Bank High Council, 29 and 30 July 2026 |
| Original amount of the same loan | 500 million tomans | Majlis Construction Committee, 2 August 2026 |
| Finished build cost per square meter (excluding land) | More than 25 to 30 million tomans | Majlis Construction Committee, 2 August 2026 |
| Cost of building a five storey building | About 60 million tomans per square meter (up 70 percent year on year) | National Association of Mass Builders, 26 July 2026 |
| Rise in building material prices | Between 40 and 270 percent | National Association of Mass Builders, 26 July 2026 |
| Average home price, Tehran districts 6 and 7 | 307 million tomans per square meter (units up to 10 years old) | Donya e Eqtesad citing Taraz, 1 August 2026 |
| Housing facility bond price | 78,000 tomans, down 43.5 percent from March 2026 | Mehr News Agency, 1 August 2026 |
| Units registered under the Housing Production Leap Law | 850,000 units, fewer than 10 percent delivered | Majlis Construction Committee, 2 August 2026 |
How many square meters this loan actually buys
A simple calculation Sahmino ran on these published figures shows the loan's real scale. At the 60 million tomans per square meter reported by the builders association, 850 million tomans covers about 14 square meters of construction. At the Construction Committee's 25 to 30 million estimate, the same amount is equivalent to 28 to 34 square meters of building work, and that is before land.
Ghasemi himself offers a third comparison: applicants in the lower income deciles cannot cover the balance on a 100 square meter property priced at roughly 2.5 to 3 billion tomans. On that arithmetic the 850 million loan covers, at best, about 28 to 34 percent of the price of such a unit, with the remainder coming out of the applicant's pocket.
Carry the number to the most expensive part of the Tehran market and the scale gets starker. Based on Taraz data published by Donya e Eqtesad on 1 August 2026, the average price of units up to 10 years old in Tehran's districts 6 and 7 is 307 million tomans per square meter, and buying a mid sized unit there requires a budget of about 27 billion tomans. The entire 850 million loan buys fewer than 3 square meters at that level. The comparison is a yardstick for purchasing power, not a description of what the loan is for: the National Housing Movement facility funds construction on state supplied land, not the purchase of an apartment in the heart of the capital.
Drivers: why the loan fell behind the cost
Three mechanisms built this gap, and each is documented.
First, the jump in materials. According to the builders association secretary, official figures show building material prices rose between 40 and 270 percent. He is explicit that this does not mean every material rose 270 percent: items such as petrochemical products saw increases of that order under wartime conditions. The materials picture is not uniform, though. Parts of the cement market moved the other way in recent months, as our reporting on cement price dispersion has shown. Current rates are on the Sahmino building materials prices page.
Second, general inflation eating the loan's nominal ceiling. A fixed rial amount shrinks every month in a high inflation economy. Point to point inflation in the Iranian month ending late July 2026 ran near 83.9 percent, as we set out in our analysis of the gap between inflation and liquidity growth, available in the Sahmino articles archive. At that rate, the interval between a ceiling being approved and the loan being paid out in stages erodes part of its value by itself. Ghasemi makes the same point about down payments: the money of applicants who paid in advance has lost so much value that "with that same money, today you cannot even buy 5 square meters."
Third, the financing bottleneck. The loan is disbursed in stages tied to a project's physical progress, and the ceiling increase itself is tied to projects above 65 percent completion. Donya e Eqtesad reported on 1 August 2026 that housing construction lending has effectively been rationed and prioritised for contractors on high progress projects. The demand side has lost its instrument too: the price of housing facility bonds has fallen to 78,000 tomans, down 43.5 percent from March 2026 (Mehr News Agency, 1 August 2026).
The market backdrop is unhelpful as well. Pourhajat notes that in wartime conditions capital turns conservative and moves toward more liquid assets such as gold and foreign currency, capital that might otherwise have gone into construction. For the concepts behind price per square meter, the rahn and rent system and transaction costs, see the Sahmino Learn section.
Outlook
This section is attribution and interpretation, not recorded fact. The Construction Committee member's proposal is explicit: either halt the scheme altogether, or raise the facility to 1.5 billion tomans and stop banks from requiring applicants to fund 100 percent of their own contribution. He also points to 170,000 hectares of worn urban fabric that already has water, power and gas infrastructure, arguing that with adequate financing and a grace period the housing needs of at least 10 to 15 million people could be met there. On the other side, Mehr's report stresses that experts see the increase succeeding only if the banking network disburses on time and funding is sustained, meaning the approved figure stays on paper until it is actually paid.
Bottom line
Today's story in one sentence: the loan ceiling rose by 200 million tomans, yet its distance from the cost of building widened rather than narrowed. Why it matters: of the 850,000 units registered under the Housing Production Leap Law, fewer than 10 percent have been delivered, and 135,000 Mehr Housing units remain outstanding from previous governments. Financing is this scheme's bottleneck, and a 70 percent increase set against a cost that has risen at least 150 percent does not clear it. The one thing to remember: at 60 million tomans per square meter, this entire loan is about 14 square meters of construction, and the applicant has to bring the rest of the house.
What to watch
Three variables, for observation only and with no buy or sell recommendation. First, how fast the agent banks actually disburse, and whether the new ceiling is extended to projects below 65 percent completion. Second, the path of finished build costs and material prices in the coming months, which determines how long 850 million tomans stays worth this much. Third, the comprehensive housing plan and the fate of the proposal to build on worn urban fabric. Dated events are tracked on the Sahmino market calendar.
