Landlord-Tenant Laws in Iran: Exploring the Residential Market

The residential real estate market in Iran is highly dynamic yet complex, heavily influenced by macroeconomic factors, inflation, and currency fluctuations. The relationship between landlords and tenants is primarily governed by the Landlord and Tenant Relations Act of 1997 (1376), the Civil Code of Iran, and the Law on Organizing the Land, Housing and Rent Market (2024).

The Legal Framework for Residential Leases

In Iran, the law highly respects private property rights, but simultaneously attempts to strike a balance to protect tenants, particularly against sudden arbitrary evictions and excessive rent hikes.

The Landlord and Tenant Relations Act of 1997

This law is considered a turning point in the Iranian housing market because it tipped the legal scales towards the freedom of contract between parties and vastly accelerated the eviction process (provided specific formal conditions are met).

To benefit from the right to an expedited, one-week eviction order issued by the Council for Dispute Resolution (Shora-ye Hall-e Ekhtelaf) pursuant to Article 3 of the 1997 Act, the contract must meet the following criteria:

1. Written Form: The contract must be in writing.
2. Signatures of Witnesses: Signed by two reliable witnesses.
3. Specified Duration: The lease must have a clearly defined start and end date.
4. Prepared in Two Copies: The agreement must be drawn up in at least two identical original copies.

Rent Increase Caps (2024 Law)

Under the Law on Organizing the Land, Housing and Rent Market (2024), the Supreme Housing Council sets annual maximum rent increase rates. For the 2024-2025 period, the cap is generally set at 25% for Tehran and 20% for other large cities. Landlords exceeding these caps face fines and are legally required to return excess rent to the tenant.

Types of Rent in the Iranian Housing Market

The Iranian rental market features a unique dual rental payment system:

1. Full Rahn (Interest-Free Loan / Mortgage): The tenant pays a massive lump sum upfront (known as the "Rahn amount"). The tenant is entirely exempt from paying monthly rent. At the end of the lease, the landlord is obligated to return the entire Rahn amount. Under the 2024 Law, the return of the Rahn amount is a prerequisite for the execution of an eviction order.

2. Rahn and Rent (Combination): This is the most common arrangement. The tenant pays a smaller lump sum as Rahn and pays a fixed monthly rent amount.

The Role of Electronic Systems and the Tracking Code

The government mandates that all residential lease agreements be registered in the National Real Estate and Housing System via the 'Saman-e Khod-nevis' portal (khodnevis.mrud.ir) or through authorized real estate agents. A unique 13-digit Tracking Code (Kod-e Rahgiri) is issued and is legally required for:

• Proving the legal validity of the contract.
• Accessing expedited eviction orders (pursuant to the 1997 Act).
• Proving residency to government authorities.

Failure to register the lease results in the loss of legal protections, including the right to expedited eviction.

With Landager's integrated property management software, you can easily track all document versions, massive Rahn deposit amounts, renewal deadlines, and monthly payments in Iran's volatile rental market, setting up automated alerts for impending eviction or renewal dates.

How Landager Helps

Landager tracks lease terms, overview.mdx compliance, and important deadlines - making it easy to stay compliant with Iran regulations.