Real Estate Market in Iraq
Iraq is ranked fourth among 14 countries in the Arab real estate market for 2024. The real estate market in Iraq is experiencing a significant transformation, driven by increased foreign investment and a growing population. In 2024, the Real Estate market in Iraq is expected to reach a projected value of US$1.11tn. The real estate sector presents lucrative opportunities for investors.
Among the various segments within this market, Residential Real Estate is anticipated to dominate with a projected market volume of US$0.84tn in the same year. According to statistics issued by Statista, a German online platform that specializes in data gathering and visualization, it is projected that the market will experience a steady annual growth rate of 4.43% from 2024 to 2028 (CAGR 2024-2028). This is resulting in a market volume of US$1.32tn by 2028. This growth is fueled by an increasing population, with 57% under the age of 25 and a driving demand for housing.
Trend in Iraq’s Real Estate Market
In a trend observed among many Iraqis, people are increasingly opting to invest in land and real estate as their primary avenue for guaranteed returns, given the current landscape devoid of viable alternatives.
The real estate market presents itself as a flourishing sector with minimal risk of loss. This sentiment is largely attributed to Iraq’s substantial demand for over three million housing units, a figure that continues to surge amidst the rapid population growth.
Moreover, the real estate market in Iraq adheres to an open market policy, where prices are dictated by supply and demand, with minimal government intervention.With substantial demand within urban areas, prices have steadily climbed over the past four years, reaching unprecedented heights.
Challenges in Iraq’s Real Estate Market
Despite the promising growth, the Iraqi real estate sector faces several challenges:
- The process of obtaining necessary permits and approvals for real estate transactions and developments can be cumbersome and time-consuming.
- The real estate market in Iraq suffers from a lack of reliable information and data, making it difficult for investors to make informed decisions.
- Infrastructure development is uneven across the country, with some areas lacking basic amenities such as roads, water supply, and electricity.
- The market operates on a 100% cash-based system. Using this system can be difficult for international buyers with large transactions. In the case of international bank transfers, this can be costly in bank fees and cause delays.
- Real Estate agents often charge fees to both sellers and buyers. This increases the cost of transactions.