Features

Iraq's housing crisis deepens amid rising rents, failed promises

The New Region

May. 06, 2025 • 6 min read
Image of Iraq's housing crisis deepens amid rising rents, failed promises Spiraling rents and limited government support have left Iraqis frustrated with an inexorable housing crisis. Graphic: The New Region

As Iraq faces a severe housing shortage, families are grappling with soaring rents, stalled government projects, and a lack of affordable options, leaving many young people viewing home ownership as an elusive dream always tantalizingly out of reach.

Hussein, 37, never thought the housing crisis would be the main reason for delaying his dreams. But when he faced the real estate market, he found himself stuck in a long wait: expensive apartments, stalled housing projects, and empty government promises.

 

“I’ve been looking for an affordable home for two years and found nothing,” he said. “Rent eats up half my salary, and the so-called low-income housing units are now for the wealthy. I haven’t been able to get married yet.”

 

He added, “It seems that housing is now the biggest problem for the younger generation. Rents take most of our income, and home prices are unreal. The dream isn’t just far; it’s tied down by promises and delayed projects. In a country where families crowd into rentals and informal neighborhoods, marriage becomes a luxury, not a right. A house in Iraq is no longer a shelter; it’s a test of endurance, a luxury only the rich or influencers can reach.”

 

In a country hit hard by wars, corruption, and political conflict, the housing crisis is more than a real estate issue. It shows a deeper failure by authorities to secure basic rights for citizens. Today, tens of thousands of Iraqi families are chasing a dream of owning a home, even as property prices keep rising.

 

Rents That Kill Dreams

 

Iraq’s housing crisis is no longer just about construction or urban planning. Social researcher Amal Abdul Latif said it now affects the core of Iraqi family life. As rents go up and incomes drop, thousands of families are stuck in small spaces and forced to delay major life decisions.

 

Abdul Latif told The New Region that the housing crisis is now a social issue that impacts daily life. “The rise in rent goes against income levels, forcing families to live in poor conditions,” she said. “That harms mental and social stability, especially among young people.”

 

She said the imbalance between supply and demand, along with the government’s weak role, has changed how people live. That includes postponing marriage, families crowding into tight homes, and even adults moving back in with parents.

 

Abdul Latif said housing has become a major financial burden. “A family that spends half or more of its income on rent slowly loses the ability to live a decent life. They get stuck in survival mode instead of growing or moving forward.”

 

When crises build and solutions fade

 

Despite lacking even basic infrastructure, the price of one square meter of housing in some working-class areas of Baghdad has reached nearly $1,000. This has pushed many people to leave the city center for the outskirts in search of cheaper housing, even if those areas lack stability or basic services.

 

Government officials continue to speak about housing projects “under construction” or “awaiting approval,” but many Iraqis now see these as just more delayed plans. The question remains: will these delayed projects meet people’s real needs for decent housing?

 

Nabeel al-Saffar, spokesman for the Ministry of Construction and Housing, said the crisis grew worse due to a big gap between supply and demand. “The real estate market follows free market rules, which pushed up rent prices and made life harder for families,” he told The New Region.

 

“Some businessmen and investors took advantage of the situation,” he added. “There’s no real oversight or market control.” Al-Saffar admitted that the ministry’s current projects are not enough to meet the growing demand for housing.

 

He said only five of the 49 housing projects launched in past years were completed. Many were halted due to Iraq’s security problems, especially in areas impacted by terrorism.

 

The ministry is now working with local governments to restart these projects. Some will be offered to investors or assigned again to construction firms to continue the work. Even if these projects meet just part of the need, it would help reduce the shortage.

 

Slow promises, fast crisis

 

To fix the housing shortage, the Iraqi government launched the New Cities project. It aims to reduce the need for housing in crowded urban areas and provide planned communities with modern housing and full services.

 

According to the Ministry of Planning, Iraq needs over 3 million housing units to close the gap. But the question isn’t just about the number of homes. It’s also about whether they are truly affordable for poor and middle-class families.

 

Maha Abdul Karim, director of development resources at the Ministry of Construction and Housing, said rising rent prices reflect a lack of strong housing policies. She blamed poor planning, slow implementation, and the lack of investment strategies that fit the country’s population growth and income levels.

 

She told The New Region that the 2023 National Population Policy document stressed the need to build decent housing for the most vulnerable groups. It also focused on reducing slums and improving infrastructure and services. The plan included poverty reduction goals and affordable housing programs, such as distributing low-cost homes in several provinces.

 

Abdul Karim said the latest national housing census recorded over 10 million housing units for a population of more than 46 million. This shows how urgent it is for Iraq to update its housing policies.

 

She called for smart, eco-friendly cities outside the current urban areas and for changes in housing laws to make it easier for people to own homes.

 

A market out of control

 

As demand for housing rises and supply stays low, Iraq’s real estate market has turned into a place of price chaos, said economist Ahmed Abdul Rabbeh.

 

“This rent crisis didn’t happen overnight,” he told The New Region. “It’s the result of years of bad housing policies and no regulation, all while the population grows and purchasing power shrinks.”

 

He said the crisis started with a clear imbalance: demand keeps going up, but there aren’t enough new housing projects. “This shortage, along with inflation and expensive building materials, pushed rent prices to record highs. Most families can’t keep up.”

 

Abdul Rabbeh said the lack of government-backed housing loans leaves people with no choice but to rent. “And without strict laws, investors are raising prices freely, not based on real housing needs but for speculation.”

 

He added that many properties are now bought just to be sold later at higher prices—not to house families or solve the crisis. “The result is families spending half their income on rent, young people unable to start a life, and citizens pushed from the city center to its edges.”

 

He said the solution lies in building new cities and government housing projects that match the population’s growth and incomes. But unless these projects are actually built, “they’ll remain nothing more than ink on paper,” he said.

 

Additional reporting by Nawara Mohammed

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