According to the International Iranian Stone Exhibition, in recent times we have witnessed an unprecedented increase in housing prices, so that some believe that the desire for housing and home ownership will remain in the heart of the middle class. Experts believe that the rise in housing prices is artificial and temporary, and will eventually lead to a market downturn.

The stone market is not a good year

Siamak Haj Seyed Javadi, a mining activist in the field of stone, referring to the increase in housing prices in Iran, said: "Recently, we have witnessed an unprecedented increase in housing prices in the country, especially in Tehran's Grand Bazaar, but the recession has entered the housing market." The recession in the housing market will directly affect the demand for construction materials and stone. Thus, it is predicted that under the influence of the false increase in housing prices and its recession, we will also see a recession in the stone industry.

The mining activist continued: "A drop of more than forty percent in stone exports and a decrease in domestic demand will cause problems for miners and processing units." In such circumstances, reducing and limiting the extraction and production of stone by mines and factories and strict control of fixed and production costs can help industry actors to overcome the crisis.

Haj Seyed Javadi, pointing out that the recession in the housing sector will have a negative impact on the stone field, clarified: "Unfortunately, this year is not expected to be a good year for the Iranian stone industry." In case of carelessness and implementation of control programs, many units, including mining and processing, will definitely suffer in this crisis.

He stressed: "Belts should be fastened much tighter and heels should be pulled, because difficult conditions are ahead."

"As reported on news sites, the amount of investment in the housing sector decreased by an average of thirty-three percent worldwide, forty-five percent in Asia," said the mining activist in the stone field, according to global reports on investment in the housing sector. - Pacific and thirty-six percent in the United States and nineteen percent in the Middle East and Europe, and this decline is expected to continue until the end of this year.

Haj Seyed Javadi, pointing out that Iran does not have a good market for stone exports, said: "Considering that most of Iran's stone exports, ie about 90% to China, which is the largest supplier of stone in Asia and the world, is predicted a sharp decline in stone exports." Iran will not be far from reality this year. Of course, this will also affect Iran's biggest rival, Turkey.

The negative impact of housing on the stone market

Behrouz Farahshirazi, a mining activist, said in response to a question about the effect of rising housing prices on the price of building stones as minerals: "Building stones are among the first links in the housing supply chain."

Shirazi continued: "Housing in Iran as a capital good has always been considered as one of the strong suckers of liquidity." With the start and end of the eight-year period, governments have always moved the housing boom and bust charts at a steady pace. What is clear is that the growth rate of liquidity during the presidency of Hassan Rouhani was much higher than in previous periods, but the attractiveness of parallel housing markets such as capital, currency and gold was higher due to the advantage of liquidity and as a result housing is out of the top of capital goods trade.

The mining activist said: "Although housing is still a powerful and low-risk asset in medium-term investment, it should be noted that due to the rapid growth of liquidity, there is no possibility of rapid fluctuations in the housing market." The housing transaction is influenced by the buyer's taste, and as a result, today we are witnessing a stagflation in the housing market.

Shirazi continued: "The current cost of housing and comparing it with the cost of housing last year is one of the main indicators of the base price of housing at any time." The stagflation in the housing sector means that while prices are falling, housing prices are rising. In long-term housing construction, changing people's tastes is an investment risk that must be taken seriously.

Referring to the impact of housing prices on the price of construction materials, the mining activist said: "The growth of housing prices has a positive effect on the prices of construction materials and minerals when the growth of housing prices is due to demand at the national level." The increase in the current housing rate in the conditions of construction recession reduces the purchasing power of the middle class and intensifies the recession, and from this point of view, it has a negative impact on the prosperity of the country's mines.

Referring to the situation of construction stone exports, Shirazi said: "In the balance of the economy, along with the housing construction recession, which is due to the devaluation of the national currency, weak economic stability and consequently the purchasing power of the middle class, we see growth in exports of minerals and building stones." We are replacing the domestic market.

The mining activist stated: Based on years of experience in monitoring the culture and taste of the housing market in Iran, mining activists have tried to design mining machinery, equipment and strategies and put together a puzzle of production and sales. If they want to continue with the same strategy, they will be under the pressure of a sluggish demand in the housing sector.

Referring to the role of manpower in the mining sector, Shirazi said: "Human resources are known as the main capital of mining, in fact, this is an important link in the supply chain of housing and industry." Accelerating changes in global markets and rapid changes in the culture of life have changed market tastes, and changing market tastes as an unsystematic risk requires agile movements commensurate with consumer needs.

He emphasized: "On a global scale, housing is a basic human need and due to the need for heavy fixed capital in the mining sector, the survival of small and medium-sized mines depends on young and specialized human resources as design groups for extraction and processing of minerals and building stones." Housing in the world.

Reducing the production motivation of stone industry activists

Ramin Ghorbanzadeh, a researcher in the stone market, said that the increase in housing prices does not have a positive effect on the stone market.

The stone market researcher continued: At this time, stone industry producers are divided into three groups; First, the group that overcame production due to the economic conditions of the country and closed or leased its production units. The second group are producers who, for good reasons, do their best to keep their factory lights on, and the third group are producers who have benefited from the country's economic situation and made good profits. Of course, the number of members of the third group may be very small compared to the production units of the first and second groups.

Ghorbanzadeh continued by saying that the situation of stone activists is not as good as in previous years: "Housing prices and profits, which are often tempting, reduce the production incentive in any guild, and the stone industry is no exception."

Predicting the situation of stone production units in the future, the stone market researcher said: "These units will definitely be closed in the near future." Although the production of this class will not decrease, what will not be compensated for the stone industry is the re-employment of a large number of trained manpower that have left the closed units.

Housing recession in the fall

Amir Beijan Yathribi, selected by the National Elite Foundation in Earth Sciences, said: "Considering the impact of governments' financial decisions and policies on variable assets such as coins, gold, etc., and by creating public interest with a tool called supply and demand that collects stray capital in The hands of the people are used to finance the current budget of the country and the weak control of governments over fixed assets such as housing, machinery, etc. I believe that our country is witnessing the influx of capital into the gold, coin and stock exchange markets.

He said: "Although we are witnessing an increase in housing prices, but the housing market will definitely face a severe recession in the fall; As has been the case with stagflation over the past three years. It is true that with the increase in general inflation, the average price per meter of land has increased, but the amount of this increase has not been in line with the increase in rates in other areas.

He continued: "To prevent a recession in the housing market, those who have invested in currency, coins and stock exchanges should withdraw their capital from these markets after a while and pour the profits from their presence in these markets into the housing market." Of course, with the policy of collecting taxes from vacant houses, the rotation of stray capital or the spending of profits from the market of variable assets in the housing market is out of the question.

The importance of construction monitoring in the country

Siamak Akhtari, International Marketing Consultant in the field of stone, referring to the importance of construction monitoring in the country, said: "One of the tasks of specialized organizations in the field of stone and construction, especially the country's stone industry, is planned and codified construction process in the country." Stone captain activists must, like the captain of a ship, observe farther horizons and be aware of the signs of price fluctuations and market capacities as a determining indicator so that their class activists can be informed as well.

Referring to the importance of this issue, this international marketing consultant in the field of stone said: The construction industry in Iran is the driving force of several related industries; As a result, job orientations and licensing, such as stone production licenses, are tailored to this demand. We are currently facing a weak supply-demand ratio due to the lack of monitoring of the same horizon.

Akhtari said: "By field observation of the statistical community of construction permits, it is possible to understand the limits of demand in the stone industry in the form of engineering." On the other hand, we have cross-sectional prosperity and the influx of capital to the construction industry, which has led to the accumulation of production capacity in this sector. With this continuous chain, we have witnessed an increase in the issuance of stone production licenses and the prosperity of this sector. Meanwhile, the domestic stone market boom was so great that exporters in the industry had less opportunity to think about the added value of exports; In this way, we were drawn to union laziness in the processing sector for export, and the processing industry and quality were not interested in operating.

Referring to the capacity of metropolises in the field of construction, the international marketing consultant in the field of stone said: "The ratio of supply and demand on the one hand and the attraction of capital and liquidity in the consumer market on the other hand are among the issues that should be considered." .

"It is true that we are facing a shortage of supply and the ratio of demand to supply is higher, but in terms of planning and urban planning strategy, we may not be able to create a reasonable proportion between population and services," said a warning about construction capacity in the country. Every city has a population acceptance capacity so that the quality of services provided to citizens reaches an acceptable standard for the welfare and protection of citizens' rights. In this area, we come to the logical limitations of urban planning.

Referring to the importance of paying attention to exports, the international marketing consultant in the field of stone said: "The country's stone industry has no choice but to strengthen itself in the field of exports and focus on the processing sector." This is an exceptional opportunity that will lead to industrial transformation. He continued: "Considering the activity of about six thousand stone cutting units in the country, most of which are active to meet domestic needs, this transformation can be key."

He stated: The stone industry of the country needs the planned and codified support of the relevant devices. Clearly, this peeling may have short-term consequences, such as job losses and loss of productivity, but the observation of successful countries in this field, such as Turkey, indicates that this path is mandatory; In other words, change occurs when it is felt necessary.

Referring to the situation of Turkey in the field of stone, Akhtari said: "This country had the record of the highest export of processed stone to the United States from 2008 to 2018." Relying on national strength, Turkey has even entered the field of machine building and has left an important competitor like Italy in this field.

He stressed: Iran can also target export horizons in a desirable way, relying on domestic strength and national efforts, and by planning and systematizing export horizons. In this regard, the details should be analyzed

last word

Experts in the field of stone predict that due to the false increase in housing prices and its recession, we will see a recession in the stone industry. According to them, the growth of housing prices has a positive effect on the prices of building stones and minerals when the growth of prices in the housing sector is due to demand at the national level, while the current housing price increase in the construction downturn reduces the purchasing power of the middle class. And the recession has intensified and from this point of view, it has a negative impact on the prosperity of the country's mines. Experts believe that in the current situation, one of the tasks of specialized organizations in the field of stone and construction, especially the country's stone industry, is to monitor the planned and codified construction process in the country. According to them, stone field activists, like the captain of a ship, should observe farther horizons and be aware of the signs of price fluctuations and market capacities as a determining indicator, so that activists in their class can be informed as well. Experts also emphasize the development of the export market and attention to foreign markets by activists in this field as a solution.