| 2008: Housing prices soar as relative security returns to Basra |
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June 12, 2008 If the housing market is an economic indicator, then Iraq’s southern city of Basra is in the midst of an economic boom. Property prices have surged more than three folds on average in the three months since a major military offensive brought some semblance of normalcy to the restive city. But the losers are families who sold their property fearing that even harsher times were ahead. Many families sold their houses at what is seen now as peanuts. When security returned, they returned too, only to find their property has more than trebled in value. “People did not only sell their homes. They even sold agricultural land and other forms of property. Now many of them have returned to a market that has turned upside down,” said Ghazi Kadhem, a Basra real estate agent. For example, he said, in the district of Zubair, one of Basra’s posh areas, average price before the military operations to subdue the city averaged 40 million dinars (a U.S. dollar is worth 1,300 dinars). But today, he added, the average price is more than 150 million Iraqi dinars. Winners are those who opted to stay despite the upsurge in security. Losers are those who chose to flee the city after selling their property. Three months ago, it was even difficult to sell a house. Demand is soaring now as life in the city is slowly returning to normalcy. Rents have gone up dramatically and the average monthly rent in Zubair, for example, is now 300,000 dinars, the average salary of a civil servant in Iraq. Mohammed Mansour said nearly 65 percent of all the families who had fled the city have returned but many are forced to rent as they had already sold their houses and cannot afford to have them back. Ahmad Hayali had fled to Syria where stayed for a few months. On hearing that Basra was safe, he decided to return. “I had to pay 55 million dinars for my own house which I had sold for less than 27 million,” he said. |