Posted on 07 November 2014.
This article was originally published by Niqash. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Real Estate Wreckers: While Ordinary Basra Families Suffer, A New Upper Class Profits
Real estate prices in Basra are rising dramatically thanks to the oil industry, the province’s economic prowess and a growing population. Many locals say a new class of corrupt officials, smugglers and developers are profiting while ordinary families are forced to move out of town.
After ten years living in the same house, in the Bariha area of Basra, Ahmed Bader and his family of five were forced to leave their home. The landlord had increased the rent to US$1,600 monthly and Bader only earns IQD900,000 (around US$760) each month.
“We had no choice,” Bader says, “we were forced to move to an agricultural area in the Abu al-Khaseeb area outside of Basra, even though that’s a long way from my workplace.”
Bader is not the only local in Basra to be feeling the effects of rising real estate prices. Central areas in Basra are heavily populated and rents for ordinary houses here are as high as US$2,000 while it now costs around US$1 million to buy a 400 square meter property here. This is despite the fact that improvements to infrastructure in central Basra have not kept pace with real estate price rises.
The reason for such price hikes: Basra is one of the centres of Iraq’s burgeoning oil industry and, as local journalist Hashim Luaibi points out, the oil companies can afford to pay these higher rates to provide for their employees. Basra is also a prosperous area and currently, because of its Shiite Muslim-majority population, it is not as troubled as other parts of Iraq by violence caused by the Sunni Muslim extremist group, the Islamic State.
There’s been an influx of Iraqis from other parts of the country to Basra over the past few years but there’s nowhere for them to live, says a local lawyer, Tariq al-Abarsim.
“Displacement and population growth combined with the absence of any real housing projects have led to chaos in the housing sector,” al-Abarsim suggests.