A very impressive report about the incredible housing prices in the semi-autonomous Kurdistan Region of Iraq by my friend and former colleague Mohammed Salih.
Some highlights:
- In some areas, housing and property prices are higher than housing prices in California.
- In some areas, prices have increased by 80 percent
- The increase has mainly been caused by foreign investment
- Kurdistan has attracted more than $20 billion in foreign investment since 2007
- Over $10 billion of the $20 billion investment has been in the housing sector
- Over 140,000 housing units have been built in recent years yet prices keep going up
The growth is not healthy. That's true.
ReplyDeleteYes I share the same view, I mean all of a sudden prices rising to 70 times more than their original prices is HUGE. This killed the hopes of dozens of thousands of families who were dreaming of owning their own houses. It is not healthy because while the housing prices have risen 70 times the previous prices, income has merely grown by 2-3 times. An average government job pays $400-500 while DECENT house renting in an average neighborhood in Erbil for instance costs $300-$500.
ReplyDeleteAll this inflation due to foreign investment was caused by the investment law that was passed in 2007 which has been described as the most investor -friendly because it provides incentives for foreign investors including the owning of land at no cost, up to 10 years tax holidays, easy repatriation of profits and removal of tariffs on exports and imports related to the project. Nowhere else in the world you can find all these incentives. And our politicians are providing these incentives only partly for the sake of the reconstruction of Kurdistan, they do this mainly because they are the number one benificiaries of all the billions of dollars. they have shares in all the investments and they get millions of dollars in getting investment deals for foreign investors. We all know that not everyone can apply for an investment project if they do not have links with the authorities and some powerful people.