Three government support measures for Tehran's rental market are on the table at once this moving season: a cap on rent increases, automatic lease renewal, and housing deposit loans. Yet according to field reporting published by Khabar Online on Saturday, August 8, 2026 (17 Mordad 1405), Tehran rents have risen 70 to 100 percent this season, with deposits (rahn, the lump-sum security deposit common in Iranian leases) on some units reaching several billion tomans. A fresh Parliament Research Center review of Article 7 of the 2024 (1403) Law on Organizing the Land, Housing and Rent Market says the problem is not just weak enforcement; the law's own design leaves landlords an easy way out.
Background
Rents in Iran have outrun household purchasing power for years. Per the Parliament Research Center, annual rent growth from the Iranian year 1399 through 1405 (2020 to 2026) ran 31, 39, 52, 60, 50, 35 and 32 percent respectively, meaning even in the calmest year of this seven-year span rents still rose by roughly a third. Sahmino previously showed, in The 57-Point Gap Between Rent Inflation and General Inflation (Tuesday, July 28, 2026), that Iran's Statistical Center reported point-to-point rent inflation of just 31.2 percent for Khordad (May/June), while actual closed Tehran rent contracts that same month rose nearly 40 percent. That gap has now widened far further, with this season's field-reported 70 to 100 percent range.
The 2024 land, housing and rent market law was meant to close exactly this gap. Its Article 7 lets the government cap rent increases in provinces where annual general inflation exceeds 30 percent, for cities with a population over 100,000. For 1405, per the Ministry of Roads and Urban Development, automatic lease renewal is in force with a 25 percent increase cap, alongside a housing deposit loan whose individual ceiling recently rose to 850 million tomans.
Key numbers
- 70 to 100 percent: the range of Tehran rent increases this moving season, per Khabar Online's field reporting (Saturday, August 8, 2026).
- 25 percent: the increase cap on automatically renewed 1405 leases, per the Ministry of Roads and Urban Development.
- 30 percent: the annual general-inflation threshold a province must cross before Article 7's rent cap can be triggered at all.
- 50 to 100 percent: the range within which the law sets the rent cap, once the 30 percent threshold is crossed, relative to annual general inflation.
- 98 of 933 cities: how many cities the current law covers; the Parliament Research Center says the other 835 are effectively left without this protection.
- 31 to 60 percent: the range of annual rent growth over the past seven years (1399 to 1405), per the Parliament Research Center.
All figures in this section come from the Parliament Research Center's review of Article 7, which Khabar Online published, citing the Khorasan newspaper, on Saturday, August 8, 2026.
Drivers
Per the Parliament Research Center, the law's most consequential design flaw is that it does not require landlords to renew a lease. Even where a rent-increase cap is set, a landlord has no obligation to renew the current tenant's lease, and can instead let the unit to a new tenant at the market rate once the term ends; in that case the cap is effectively neutralized, since it only has force for a lease actually being renewed, not for a fresh one.
The second flaw is ambiguity in the trigger itself. The law requires the Supreme Housing Council to find a "binding expediency" (maslahat-e molzemeh) before applying the cap in a province, a standard the Research Center says is neither clear nor measurable, leaving implementation to administrative discretion.
The third flaw is complaint-driven enforcement: catching violations falls to the tenant, the weaker party in the transaction. Per ISNA field reporting reflected by Khabar Online, many tenants avoid objecting even to violations of the 25 percent cap, for fear of eviction.
The fourth flaw is the law's narrow geographic reach: it covers only 98 cities, while the Research Center says the rent crisis is not confined to major metropolitan areas.
Outlook
In its conclusion, the Parliament Research Center recommends: removing the 30 percent inflation threshold and replacing it with indicators such as the poverty rate among tenant households or minimum-wage growth; requiring lease renewal for compliant tenants, with exceptions such as a landlord's genuine personal need for the unit or lawful demolition and reconstruction; moving enforcement away from a complaint-only model by linking national systems and electronic invoicing; and expanding the law's coverage to every housing-crisis-affected area of the country. These are still recommendations in a parliamentary research report, not adopted legislation, so they do not change today's market; until any amendment passes, the current law will keep operating with these flaws.
The Ministry of Roads and Urban Development has separately promised to add a feature to its Khodnevis lease-registration system that would automatically compare a new rent against the prior year's contract. That promise has not yet been implemented, and real-estate agents say they currently have no access to prior-year contracts to check compliance.
Bottom line
The government's three support measures have not stopped Tehran rents from jumping 70 to 100 percent this moving season, because none of them obliges a landlord to renew a lease, and the approved cap only has meaning for a lease actually being renewed. Until that missing link is fixed, whatever cap is set can, in practice, be sidestepped simply by signing a new lease, a pattern Tehran's housing sale and rental market has shown repeatedly in recent months.
What to watch
- Whether the lease-comparison feature the Ministry of Roads promised for the Khodnevis system actually goes live.
- How parliament responds to the Research Center's proposed amendments to Article 7, including a lease-renewal mandate.
- The Statistical Center of Iran's official rent inflation reading for Mordad (July/August), to measure its gap against this season's field-reported 70 to 100 percent range.
