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Housing projects in the Kurdistan Region are expensive internally and suitable externally
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2024-07-25 03:35
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Shafaq News/ The pace of implementing housing projects in the Kurdistan Region is increasing at various economic levels, starting from low-cost to expensive, to lead the most important investments during the past two decades, outperforming investment in the industrial sector.
However, the low demand for purchasing residential units leads to an excess supply, due to the economic and political crises, in addition to the significant increase in the prices of most properties, which has led to a failure to contribute to solving the housing crisis.
Activist Susan Surmeri, from Sulaymaniyah, told Shafaq News Agency, "The prices of housing units within the cities of the region are very high when compared to real estate outside Kurdistan or in neighboring countries, which are much lower."
She added, "The real estate market in Sulaymaniyah is different from other cities in that it depends on the general economic situation, which has been greatly affected by the delay in paying employees' salaries. For example, in previous years that witnessed a halt in paying salaries, real estate prices fell significantly to below their real prices."
“In general, if we estimate the cost of residential projects, the price per square meter ranges between $300 and $600 at the highest estimate, while they are sold by the investor at prices ranging between $500 and more than $1,000. As for the houses called villas, their price reaches more than $2,000 per square meter, which means double profits,” she points out.
“The real estate market in Sulaymaniyah is completely different from other cities, especially the capital Erbil, because about 90% of buyers of residential units in the center of Sulaymaniyah Governorate are locals who buy for themselves or their relatives. Despite the increase in real estate companies in Sulaymaniyah in recent years, there are also villagers who buy residential units within the city, and this is a negative indicator as it leads to migration to cities and the evacuation of rural areas due to the lack of job opportunities,” Surmeri explained.
The Directorate of Investment in Sulaymaniyah revealed earlier that more than 85 investment licenses had been granted to establish residential complexes that would contribute to solving the housing crisis in the province.
The Director General of the Investment Authority in Sulaymaniyah, Aziz Saeed, told Shafak News Agency that the Authority has worked during the past years to implement about 90 thousand housing units through investment, and what has been accomplished so far is about 60 thousand housing units.
He pointed out that "86 investment licenses were granted to establish residential complexes within the borders of Sulaymaniyah, and what has been completed so far is 50 residential complexes, and now there are 36 residential investment complexes under construction."
Regarding the size of financial investments in these projects, Saeed confirmed that “the size of investments in them is about 22 billion dinars, and all licenses were granted to local investors at a rate of 100%.”
For his part, economic expert Bilal Saeed explained in a statement to Shafaq News Agency, "The price of one square meter of residential units in Erbil and almost all of Kurdistan ranges between $550 and $1200, which means that any simple citizen who wants to buy a residential unit must save his entire salary for a period of no less than ten years, which is abnormal, or save half of his salary for a period of no less than twenty years to be able to buy a residential unit in one of the investment projects, which means that any citizen who depends on a monthly salary cannot easily buy a residential unit."
Regarding the impact of residential investment projects on the reality of services in city centers, Saeed points out that “these projects had a direct impact on the services provided in city centers. For example, if a residential complex is implemented, it needs at least two artesian wells, which means an impact on the water storage of the region. We conducted a field study on the water available in Erbil neighborhoods and found that the quantities of water have decreased significantly from what they were in the past.”
He confirms, “According to the data we collected from various sources, the number of residential projects (apartments, houses, and villas) that have been established over the past two decades and are currently being dealt with in the real estate market is 131 residential projects, including 128,542 apartments, houses, and villas of various sizes.”
He continued, "What the data shows is that more than 50,000 housing units will be completed in Erbil during this year and the next two years, and also the number of units that are supposed to be delivered to their owners during this year is 27,000 units, and this speed in constructing housing units is not limited to Erbil only but also in Sulaymaniyah."
According to the data reviewed by Shafaq News Agency, 5,035 houses and 22,004 apartments will be built during the current year, which means that 27,039 new housing units will enter the real estate market in Erbil, although some of them were completed last year. In addition, 25,843 new units will be completed during the next two years, including 21,673 apartments, which will change the entire housing sector from horizontal to vertical.
Earlier, the spokesman for the Kurdistan Region Investment Board, Barkasht Akriye, announced that investment licenses would be granted to 154 projects with a capital exceeding four billion dollars during the year 2023.
He said, "Licenses were granted for 50 projects in Erbil, 43 projects in Sulaymaniyah, 29 projects in Dohuk, 12 projects in Garmian, eight in Zakho, five in Raparin, four in Soran, and three in Halabja."
He pointed out that "most of the licenses issued in 2023 were in the residential sector, followed by the commercial sector, and in third place came the industrial sector, then the health, education, agricultural, artistic and sports sectors."
According to the data of the Investment Commission from August 1, 2006 to May 2, 2024, the real estate sector contributed 29.24% of the total investment capital in the Kurdistan Region, and the total investment projects that obtained permits throughout the region are 216 projects, but the number of projects in this sector is much more than the number of the Investment Commission, except that the majority of projects recently obtained permits from ministries or other government institutions in Kurdistan because the lands were owned by the investors themselves.
Regarding granting special residencies to those coming to the region, the official spokesman for the Kurdistan Region Asayish Institution, Colonel Salam Abdul Khaliq, confirmed to Shafak News Agency, "The issue is related to special security procedures, including granting those who come from outside the region, even if they are Kurdish, a special security form, in light of which they obtain a special (code), and the residency is renewed every period of time because it is not a permanent residency, but rather a temporary one, and obtaining it is very easy and there is no noteworthy complication."
A legal source in the Sulaymaniyah Investment Directorate, who preferred not to reveal his identity, confirmed to Shafak News Agency that "the Investment Authority grants many facilities to investors according to Law No. 4 of 2006, and they differ according to the nature of the project. There are tax and customs exemptions for a period of ten years from the start of the project, and this is after granting the investment license, in addition to land allocation privileges that are granted free of charge to the investor in exchange for implementing a public service for the city, such as paving a street or what represents public service projects without charge, in addition to the duties that the law obligates the investor to do in exchange for these privileges."
Regarding determining the prices of residential units, the source explained that “the economic department in the authority is the one that determines the prices according to the schedule of the economic feasibility study for the project submitted by the investor after verifying the quality of services provided within the project and the materials used in construction, after which the price per square meter of the unit is determined.”
Regarding the provision of services to residential projects, the source explained that “the law obliges the government to provide services to the complex, but the process of transferring and providing services to residential units is the responsibility of the investor himself, who bears all costs and also pledges not to demand the costs of those services.”
In his interview with Shafak News Agency, former member of the Investment Committee in the Sulaymaniyah Provincial Council, Castro Marouf, stressed that "the projects granted to investors are in the interest of the investor first and foremost, not the needy, poor, and middle-income citizen."
He points out that "most of the services that are promoted in the media in a huge way do not exist on the ground due to the lack of follow-up by government institutions of these projects, and also because these projects are granted to investors close to the authorities."
He stressed, "The poor citizen cannot buy a housing unit whose price ranges between $60,000 and more than $160,000, while the land is given to the investor without charge, and the investor can, through the facilities provided to him by the government, grant housing units at prices much lower than those currently in use. Moreover, the residents of these projects continue to pay large sums to the investor as services."
Marouf explains, “It is clear that some of these residential projects have 24-hour electricity and water services for their residents, while we find citizens demonstrating to provide more hours of electricity or larger quantities of water to suffice them in the summer.”
Marouf demands that “the current investment law be amended by the Kurdistan Parliament and that long-term plans be put in place because the land and customs facilities granted to investors affect the people of the country and these projects have not solved the housing crisis, but rather have contributed to the rise in real estate prices in Sulaymaniyah and the region in general.”
On the other hand, those interested in the environment find that some investment projects have greatly affected the environment. Environmental activist Ako Sheikh Mohammed told Shafak News Agency, "Some projects represent a trade in the environment, especially the projects that will be established at the foot of Mount Koiza in Sulaymaniyah."
He added, "There is a group of activists, environmentalists and human rights activists who are seeking to prevent some investors and influential people from tampering with nature, and we will resort to all means to prevent them from doing so."
In turn, one of the investors who preferred not to reveal his identity, confirmed to Shafaq News Agency, "The special laws in the Kurdistan Region are very helpful in investment, and security is one of the basic things that investors are looking for to work, and this is also available in the region, and the environment in it is suitable for investment, in addition to the fact that the crises we are going through are temporary."
Regarding the impact of the fluctuation in the dollar exchange rate on the real estate investment market, he points out that “the rise and fall in the dollar exchange rate against the Iraqi dinar had a direct impact on projects, as citizens are confused about buying a residential unit in dinars or dollars due to this fluctuation, and this impact is still ongoing until now.”
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[You must be registered and logged in to see this image.]
2024-07-25 03:35
Share
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Shafaq News/ The pace of implementing housing projects in the Kurdistan Region is increasing at various economic levels, starting from low-cost to expensive, to lead the most important investments during the past two decades, outperforming investment in the industrial sector.
However, the low demand for purchasing residential units leads to an excess supply, due to the economic and political crises, in addition to the significant increase in the prices of most properties, which has led to a failure to contribute to solving the housing crisis.
Activist Susan Surmeri, from Sulaymaniyah, told Shafaq News Agency, "The prices of housing units within the cities of the region are very high when compared to real estate outside Kurdistan or in neighboring countries, which are much lower."
She added, "The real estate market in Sulaymaniyah is different from other cities in that it depends on the general economic situation, which has been greatly affected by the delay in paying employees' salaries. For example, in previous years that witnessed a halt in paying salaries, real estate prices fell significantly to below their real prices."
“In general, if we estimate the cost of residential projects, the price per square meter ranges between $300 and $600 at the highest estimate, while they are sold by the investor at prices ranging between $500 and more than $1,000. As for the houses called villas, their price reaches more than $2,000 per square meter, which means double profits,” she points out.
“The real estate market in Sulaymaniyah is completely different from other cities, especially the capital Erbil, because about 90% of buyers of residential units in the center of Sulaymaniyah Governorate are locals who buy for themselves or their relatives. Despite the increase in real estate companies in Sulaymaniyah in recent years, there are also villagers who buy residential units within the city, and this is a negative indicator as it leads to migration to cities and the evacuation of rural areas due to the lack of job opportunities,” Surmeri explained.
The Directorate of Investment in Sulaymaniyah revealed earlier that more than 85 investment licenses had been granted to establish residential complexes that would contribute to solving the housing crisis in the province.
The Director General of the Investment Authority in Sulaymaniyah, Aziz Saeed, told Shafak News Agency that the Authority has worked during the past years to implement about 90 thousand housing units through investment, and what has been accomplished so far is about 60 thousand housing units.
He pointed out that "86 investment licenses were granted to establish residential complexes within the borders of Sulaymaniyah, and what has been completed so far is 50 residential complexes, and now there are 36 residential investment complexes under construction."
Regarding the size of financial investments in these projects, Saeed confirmed that “the size of investments in them is about 22 billion dinars, and all licenses were granted to local investors at a rate of 100%.”
For his part, economic expert Bilal Saeed explained in a statement to Shafaq News Agency, "The price of one square meter of residential units in Erbil and almost all of Kurdistan ranges between $550 and $1200, which means that any simple citizen who wants to buy a residential unit must save his entire salary for a period of no less than ten years, which is abnormal, or save half of his salary for a period of no less than twenty years to be able to buy a residential unit in one of the investment projects, which means that any citizen who depends on a monthly salary cannot easily buy a residential unit."
Regarding the impact of residential investment projects on the reality of services in city centers, Saeed points out that “these projects had a direct impact on the services provided in city centers. For example, if a residential complex is implemented, it needs at least two artesian wells, which means an impact on the water storage of the region. We conducted a field study on the water available in Erbil neighborhoods and found that the quantities of water have decreased significantly from what they were in the past.”
He confirms, “According to the data we collected from various sources, the number of residential projects (apartments, houses, and villas) that have been established over the past two decades and are currently being dealt with in the real estate market is 131 residential projects, including 128,542 apartments, houses, and villas of various sizes.”
He continued, "What the data shows is that more than 50,000 housing units will be completed in Erbil during this year and the next two years, and also the number of units that are supposed to be delivered to their owners during this year is 27,000 units, and this speed in constructing housing units is not limited to Erbil only but also in Sulaymaniyah."
According to the data reviewed by Shafaq News Agency, 5,035 houses and 22,004 apartments will be built during the current year, which means that 27,039 new housing units will enter the real estate market in Erbil, although some of them were completed last year. In addition, 25,843 new units will be completed during the next two years, including 21,673 apartments, which will change the entire housing sector from horizontal to vertical.
Earlier, the spokesman for the Kurdistan Region Investment Board, Barkasht Akriye, announced that investment licenses would be granted to 154 projects with a capital exceeding four billion dollars during the year 2023.
He said, "Licenses were granted for 50 projects in Erbil, 43 projects in Sulaymaniyah, 29 projects in Dohuk, 12 projects in Garmian, eight in Zakho, five in Raparin, four in Soran, and three in Halabja."
He pointed out that "most of the licenses issued in 2023 were in the residential sector, followed by the commercial sector, and in third place came the industrial sector, then the health, education, agricultural, artistic and sports sectors."
According to the data of the Investment Commission from August 1, 2006 to May 2, 2024, the real estate sector contributed 29.24% of the total investment capital in the Kurdistan Region, and the total investment projects that obtained permits throughout the region are 216 projects, but the number of projects in this sector is much more than the number of the Investment Commission, except that the majority of projects recently obtained permits from ministries or other government institutions in Kurdistan because the lands were owned by the investors themselves.
Regarding granting special residencies to those coming to the region, the official spokesman for the Kurdistan Region Asayish Institution, Colonel Salam Abdul Khaliq, confirmed to Shafak News Agency, "The issue is related to special security procedures, including granting those who come from outside the region, even if they are Kurdish, a special security form, in light of which they obtain a special (code), and the residency is renewed every period of time because it is not a permanent residency, but rather a temporary one, and obtaining it is very easy and there is no noteworthy complication."
A legal source in the Sulaymaniyah Investment Directorate, who preferred not to reveal his identity, confirmed to Shafak News Agency that "the Investment Authority grants many facilities to investors according to Law No. 4 of 2006, and they differ according to the nature of the project. There are tax and customs exemptions for a period of ten years from the start of the project, and this is after granting the investment license, in addition to land allocation privileges that are granted free of charge to the investor in exchange for implementing a public service for the city, such as paving a street or what represents public service projects without charge, in addition to the duties that the law obligates the investor to do in exchange for these privileges."
Regarding determining the prices of residential units, the source explained that “the economic department in the authority is the one that determines the prices according to the schedule of the economic feasibility study for the project submitted by the investor after verifying the quality of services provided within the project and the materials used in construction, after which the price per square meter of the unit is determined.”
Regarding the provision of services to residential projects, the source explained that “the law obliges the government to provide services to the complex, but the process of transferring and providing services to residential units is the responsibility of the investor himself, who bears all costs and also pledges not to demand the costs of those services.”
In his interview with Shafak News Agency, former member of the Investment Committee in the Sulaymaniyah Provincial Council, Castro Marouf, stressed that "the projects granted to investors are in the interest of the investor first and foremost, not the needy, poor, and middle-income citizen."
He points out that "most of the services that are promoted in the media in a huge way do not exist on the ground due to the lack of follow-up by government institutions of these projects, and also because these projects are granted to investors close to the authorities."
He stressed, "The poor citizen cannot buy a housing unit whose price ranges between $60,000 and more than $160,000, while the land is given to the investor without charge, and the investor can, through the facilities provided to him by the government, grant housing units at prices much lower than those currently in use. Moreover, the residents of these projects continue to pay large sums to the investor as services."
Marouf explains, “It is clear that some of these residential projects have 24-hour electricity and water services for their residents, while we find citizens demonstrating to provide more hours of electricity or larger quantities of water to suffice them in the summer.”
Marouf demands that “the current investment law be amended by the Kurdistan Parliament and that long-term plans be put in place because the land and customs facilities granted to investors affect the people of the country and these projects have not solved the housing crisis, but rather have contributed to the rise in real estate prices in Sulaymaniyah and the region in general.”
On the other hand, those interested in the environment find that some investment projects have greatly affected the environment. Environmental activist Ako Sheikh Mohammed told Shafak News Agency, "Some projects represent a trade in the environment, especially the projects that will be established at the foot of Mount Koiza in Sulaymaniyah."
He added, "There is a group of activists, environmentalists and human rights activists who are seeking to prevent some investors and influential people from tampering with nature, and we will resort to all means to prevent them from doing so."
In turn, one of the investors who preferred not to reveal his identity, confirmed to Shafaq News Agency, "The special laws in the Kurdistan Region are very helpful in investment, and security is one of the basic things that investors are looking for to work, and this is also available in the region, and the environment in it is suitable for investment, in addition to the fact that the crises we are going through are temporary."
Regarding the impact of the fluctuation in the dollar exchange rate on the real estate investment market, he points out that “the rise and fall in the dollar exchange rate against the Iraqi dinar had a direct impact on projects, as citizens are confused about buying a residential unit in dinars or dollars due to this fluctuation, and this impact is still ongoing until now.”
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