Iraq property plans unveiled

Country:  Iraq

31 July 2009

Years of military conflict and inadequate investment has left Iraq with a severe shortage of residential properties, according to a report from the United Nations (UN).

With over half the country’s population living in slum-like circumstances, the UN report says that Iraq requires at least 1.5m new homes to add to its existing total housing stock of around 2.8m residential units.

With Iraq’s urban population expected to double by 2030, the UN fear that a shortage of residential stock could potentially prove to be a huge problem in the future, and as a consequence they want residential construction work to start almost immediately.

Planning Minister Ali Baban said: “Iraq has an increasing housing shortage, crumbling infrastructure and a lack of basic services as a result of years of war, neglect and lack of sufficient investment. We need to address this urgently.”

Consequently, the government has announced its intention to build 3.5m new build homes over the next decade. The project will require billions of pounds of fresh investment, opening the door to mass property investment opportunities.

A government spokesman said: “'There are substantial opportunities for construction and development. Our rebuilding programme is massive. As well as housing we need to invest in schools, roads, bridges and other infrastructure.”

Key plans include the construction of a new train network worth in the region of £3m, while a similar amount of money will be spent on building an international airport in Karabala. A number of multibillion pound residential projects will also be created throughout the country.

However, foreign investment holds the key to the regeneration of Iraq, according to Baban, who estimates that around 85% of the essential financial support would need to come from overseas. “Sustainable urban development is a major challenge for Iraq,” he added.

A number of housebuilders have already expressed an interest in taking on projects in Iraq. Baghdad Mayor Saber al-Issawi said the city had received bids from seven foreign companies to build 150,000 new homes, among other infrastructural improvements over the next decade.

Around 65,000 residential units will be built eastern Baghdad, as part of a $20 billion housing project for the region.

Editor’s comment:

“Investing in Iraq’s property market obviously comes with its associated risks, but this should be reflected in the long-term investment returns potentially on offer.”
 

See Also:   Iraq, Marc Da-Silva, Overseas property investor news, United Nations