Sanctions empty Tehran's poshest properties

    Just Watched

    Tehran's empty luxury homes

Tehran's empty luxury homes 02:39

Story highlights

  • Luxury apartments in Tehran are lying empty despite investors looking to buy
  • Iran's economy has been heavily affected by international sanctions
  • Buyers are hoping prices go down and sellers are hoping prices go up

In one of the most exclusive neighborhoods in northern Tehran, a Japanese-inspired garden with mini-waterfalls welcomes potential buyers to a newly built luxury apartment.

The four bedroom, four bathroom unit boasts marble floors, a state of the art open kitchen, computerized lighting systems and amenities that rival five star hotels.

It's an apartment so posh visitors are required to wear sanitary shoe covers.

With a market value close to $3.5 million, the need for guests to tread carefully is understandable.

"In my opinion it's worth it," says real estate agent Bahar Khalili. "It's one of the best apartments in Tehran. An exceptional building designed by the best developer in the city."

    Just Watched

    Cashing in on Jakarta's hot property market

Cashing in on Jakarta's hot property market 02:43

    Just Watched

    A new look for industrial Hong Kong

A new look for industrial Hong Kong 02:44

    Just Watched

    Jordan's king backs new financial hub

Jordan's king backs new financial hub 02:44

    Just Watched

    Living in a shipping container

Living in a shipping container 02:29

But for the past year this swanky home has sat empty without a buyer -- half the other units in the six-floor block are empty, too.

So are tens of thousands of other apartments throughout Tehran, all for sale but sitting vacant without buyers.

    "Right now we have a lot of apartments that are not sold and sitting empty because of high prices," says Khalili.

    Housing prices in Tehran soared beginning in 2012, soon after western powers imposed the toughest round of economic sanctions against Iran to curb its disputed nuclear program.

    The sanctions were a huge blow to Iran's economy and when the value of Iranian currency took a nose dive and no one could figure out where the economy was going, many here poured their money into real estate.

    According to political analyst, Mohammad Ali Shabani, "real estate became the best way to protect your money."

    Khalili agrees with this sentiment. "This is the safest investment you can make today," she said.

    "Real estate has always increased in value. We have one apartment that's increased roughly $1,000 per square meter in the past five months.

    "If someone wants to invest in Tehran and knows what he's buying, it's almost (a) certainty that's a good investment."

    But with Iran's economic future still looking hard to predict and many Iranians lacking buying power, the market is at a standstill -- sellers not selling because they're hoping prices go up. Buyers are not buying because they're hoping prices go down.

    The outcome is a Tehran skyline full of empty apartments -- and investors still looking to buy and build despite very little demand.

    "Sometimes you wonder how can people possibly build more apartments when nothing is selling," said Khalili.

    But remarkably, it's happening in Tehran because until the economy improves and housing prices start to stabilize, they believe, real estate is the safest place to invest.

    Read: Map your property hopes and fears

    Read: Futuristic North Korean architecture

    Read: China's world of mimicry

        One Square Meter

      • An artists impression of a Shinzu Corp structure on surface level.

        What would happen if the legend of the Lost City of Atlantis was crossed with the screenplay of Kevin Costner's 1995 hit movie "Waterworld"?
      • An artist's impression of the Shanghai Tower on completion

        2014 has been a big year for towering new skyscrapers, but next year will be bigger.
      • spc one square meter singapore sports hub_00002608.jpg

        It's the latest landmark on Singapore's already busy skyline.
      • spc one square meter japan hydroponic vegetable farms_00015703.jpg

        CNN's John Defterios explores how Japan is transforming abandoned factories into soil-less hydroponic vegetable farms.
      • A new kind of location service could change the way we look at the world.
      • It's the townhouse that twists like a Rubik's cube, to bask in the summer sun and shield itself when winter bites.
      • Could you fit your life into 300 square feet? Developers are betting on it, with new, tiny living spaces for urban millennials.