Fear drives Baghdad's housing bust (Iraq's housing bubble)

msnbc ^ | 9/21/2007 | Megan Greenwell/WP

[tobyhill]

BAGHDAD - Esad Ismael broke the most important promise he ever made.

As his father lay on his deathbed two years ago, Ismael, 43, vowed never to sell his family's home. His father and grandfather had spent all their savings to build the sprawling two-story house in Baghdad's wealthy Mansour district 70 years ago. Family memories were tucked between every tile on the floor.

But Ismael, a Sunni clothing merchant, was living in an area that was falling under the control of the Mahdi Army, Iraq's largest Shiite militia. Mindful of his promise to his dying father, he refused to move even after he began finding death threats pasted to his front door. After his brother was murdered, he gave up.

"It's bad that I sold our home, but what is worse is that I sold it for only 145 million dinars," Ismael said, naming a price equivalent to about $118,000 -- less than half the house's appraised value in late 2003. "It's an insult to my father to sell it so low. But what choice did I have? They would have killed us."

With hundreds of thousands of Baghdad residents having fled their homes for the relative safety of segregated neighborhoods or foreign countries, a clandestine system of buying and selling property off the books has supplanted more traditional real estate practices. If families being pushed out are lucky, they are able to sell their homes for some small price, as Ismael did. Wait too long, and their houses might be seized at gunpoint.

[Allegra]

Hm. Baghdad has become considerably calmer and more settled in the last month.

Not much in the way of car bombs and mortars and nasty firefights for the media to report.

So, they resort to stuff like this...

I wonder when these quotes were collected? I notice the article sort of omits that minor detail.

[RockinRight]

Terrorism certainly brings down home values.

[edcoil]

I have a friend in New York City and when they put their house on the market, the local mob boys visited them to ensure they would only sell to “their” kind of people so the neighborhood would keep its local ethnic community.

[tobyhill]

The one guy says his home is worth $118,000 US and he’s a Sunni that has to leave because of the violence but who did he sell it to? If the violence is so bad then a Shiite would have just taken it.
I was on Google Earth the other day looking at Baghdad from early ‘07 satellite photos and while I’m sure it didn’t represent exactly how it looks on the ground, it looks like everyday in a big city and the housing looks almost untouched with violence.