The Iraqi Housing Boom
That’s partly because the city has become much safer since 2007, as sectarian violence has receded in the Iraqi capital. While people are moving back to Baghdad in ever larger numbers, new construction has been slow to get off the ground, further tightening the housing supply.
The northern Iraqi region of Kurdistan, meanwhile, faces the opposite problem — construction of new homes has skyrocketed, outpacing demand. Compounding the problem is the fact that, in the Kurdish town of Erbil, at least, most of the new homes cost between $250,000 to $650,000 — far more than the average Iraqi can afford.
Since there is no mortgage market in Iraq and the vast majority of real estate transactions are conducted fully in cash up front, these houses even cost more than most Americans — or most anyone of any nationality — could afford.
So who buys a luxury home in northern Iraq? Government officials, oil executives, wealthy Kurds from abroad. But the homes are selling slowly, and only time will tell whether the subdivisions of Erbil can avoid the fate of this Seattle subdivision, which the American housing crisis has turned into a ghost town.