Iran's interbank interest rate decreased to 23.96% in the week ending on February 21, the Central Bank reported on February 20, indicating a level of calm in the banking sector in the country despite a weakening rial in the free market exchange rates.

The weighted average interbank rate dropped one basis point from 23.97% recorded in the previous week, according to the bank's latest data.

The interbank market allows financial institutions to borrow and lend funds among themselves, typically on a short-term basis.

The notes come as Iran's property market is likely to remain in recession until 2026 amid high prices and weak consumer purchasing power, according to a new market analysis published on February 19.

Property transactions in Tehran fell to 3,700 units in August 2023, down significantly from 14,000 units in June 2022, highlighting the market's continued downturn, the Sahebkhabar news website reported.

Housing costs now consume 55.8% of household expenditure, up from 35.5% in 2001, pricing many potential buyers out of the market despite steady price growth remaining below inflation rates.

"Both consumers and investors have largely withdrawn from the market. Investors only enter when consumers show interest and have purchasing power. The property market first needs consumers to enter before it becomes attractive to investors," said Akbar Mahmoudi, market analyst.

The prolonged slump stems from sharp currency depreciation since 2018, which drove up land and construction material costs. Analysts say recovery depends on increased liquidity and banks offering mortgages covering up to 50% of property values.

Based on historical patterns showing recessions lasting 18-24 months, the market is unlikely to rebound before 2026, according to industry experts.