Reports 02 August, 2023

Inside Iran: Housing, Water Management, and Rural Development

The Unit for Iranian Studies

The Unit for Iranian Studies, established in March 2020, is the Center’s department dedicated to the study of Iranian affairs, aiming to gain a deeper knowledge of Iran's social, economic, cultural, and political reality. Chaired by Dr. Mehran Kamrava, Professor of Government at Georgetown University, Qatar, the Iranian Studies Unit focuses on two main themes: Relations between Iran and the Arab world in the fields of history, demography, philosophy, economics, politics, international relations and culture, and bridging the knowledge gap on Iran, as a country, society and institutions.

acrobat IconSince the late 1980s and with the establishment of the first postrevolutiuonary five-year development plan (1989-1993), Islamic Republic’ has prioritized the provision of affordable housing, access to sufficient water, and rural development.[1] The success of the development plans has been limited, however, due to continued domestic and foreign policy challenges such as corruption and mismanagement, comprehensive international sanctions, low economic growth, and persistently high rates of inflation. Iran has recently unveiled its seventh development plan which will mainly focus on economic progress, an important challenge facing the Islamic Republic due to its impact on other sectors as well as the living standards of citizens. Some of the main economic issues tackled by the seventh development plan (2023-2027) include issues related to the budget, energy market, and the banking sector.[2]

Ebrahim Raisi’s government has not been able to make much progress on the economy, and, in turn, on the country’s social indicators.[3] Amid the persistence of high inflation in the country, price hikes continue to haunt the housing sector. When it comes to housing policies, Raisi has followed in the footsteps of former president Mahmoud Ahmadinejad. Raisi has promised to build four million houses by the end of his term in 2025. In February 2023, he inaugurated 10,000 housing units in both rural and urban areas in Iran. This was part of the Mehr housing project, first launched by Ahmadinejad in 2007 and meant to provide housing for low-income households.[4] Nevertheless, providing housing units has not led to long-term solutions to housing affordability.

Iran’s large housing projects, and the Mehr housing plan in particular, have been subject to widespread criticism by experts. Survey results of a qualitative study conducted in 2020 revealed that social dissatisfaction with the Mehr housing project is attributed to six factors: infrastructural challenges, lack of resource, insufficient attention to residents’ needs, beauracracy and institutional obsticacles, issues related to the legal status of land and buildings, and impractibility of housing location.[5] Similar issues were also raised in a qualitative study, by Pooya Alaedini and Maryam Jamshidinasab, with residents in the city of Parand, where Mehr housing projects were carried out. Their results showed that the location of the housing units far from even the outskirts of the city of Tehran, impacted people’s access to urban services, resources, opportunities, and, consequently, the right to the city.[6] Therefore, both the Raisi administration and its predecessors have all engaged in quick fixes rather than adopting policies that would address housing market woes in the long run.

The provision of adequate housing is also dependent on the supply of water, an important infrastructure service that impacts people’s livelihoods. Iran’s water issues have exacerbated over the recent years, with the country lacking a sustainable and resilient water supply. Most importantly, Iran does not have a clear strategy in place to deal with its growing demand for water. Water mismanagement due to rapid urbanization and development has further aggravated water insecurity. Climate change is an important factor for internal migration, rural to urban, and has resulted in population imbalance.[7] Over the recent years, recurring bouts of drought and floods have become widespread, adding to popular grievances about state incapacity and political mismanagement. The increase in urban population raises important questions related to water management, housing, and rural development. This issue of Iran Reports, written from the perspective of scholars based in Iran, presents an overview of these domestic challenges, as well as it provides important recommendations to address Iran’s policy challenges related to housing, urban water management, and development.

Pooya Alaedini discusses the importance of housing for household welfare, Iran’s urban housing initiatives, housing policies, and policy challenges facing the Ebrahim Raisi administration. Given the significance of housing in the constitution, the Islamic Republic has enacted housing initiatives and legislation to meet the growing need of its population for housing. During the early post-revolutionary days, it established many new institutions to offer housing for the needy. The government provided subsidized home loans and carried out many sites-services projects, many of which lacked long-term strategy and further increased rural-urban migration. According to Alaedini, the housing sector targets in the first three development plans did not materialize and mostly led to an increase in housing prices and speculative activities. The fourth development plan (2005-2009) proposed a Comprehensive Housing Plan (CHP) to provide affordable housing to the low-income rural and urban populations. Under the Ahmadinejad administration (2005-2013), the government launched the Mehr Housing Plan (MHP) to provide land and tax exemptions to disadvantaged households. The Rouhani administration revised the CHP and pledged to continue the MHP activities, which were also supported in the Sixth National Development Plan (2016-2021). Despite such efforts, home ownership in Iran continues to decline and housing costs have increased, indicating the negative impact of high inflation on low-income families. Alaedini argues that this is due to the lack of comprehensiveness of such policies and sustainability, as well as failure to connect housing with poverty-reduction and social welfare programs. Therefore, Alaedini suggests that the Raisi government needs to readopt the CHP.

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Tackling the issue of water management in Iran, Masoumeh Mirsafa argues that the country’s rapidly growing population has put pressure on its water resources, necessitating a paradigm shift in urban water management. According to Mirsafa, water management in Iran needs to consider the environmental, aesthetic, social, and economic objectives of the city and its citizens. The current urban water management disregards the community-based practices and techniques meant to preserve water and reduce its waste. It also fails to prevent environmental catastrophes and has increased the consumption of water. Mirsafa states that while traditional practices cannot respond to the growing demand for water, it is important to study and identify their functions to come up with a new, resilient, and sustainable method of water management. Nevertheless, Mirsafa’s article explains some of the characteristics of the traditional practices related to the sustainable use of water to respond to the challenges related to urban water management today.

[1] For an evaluation of Iran’s first development plan see: Hooshang Amirahmadi, “Iran’s development: Evaluation and challenges,” Third World Quarterly, Vol. 17, No. 1 (1996), 123-147.

[2] “Seventh National Development Plan unveiled,” Tehran Times, May 20, 2023, https://bit.ly/3OEuSGt.

[3] Nikolay Kozhanov, “Between Development, Growth, and Survival: Iran’s Economic Priorities before and under President Raisi,” The Muslim World, Vol. 113, No. 1-2 (2023), 45-60.

[4] “Raisi inaugurates 10,000 housing units across Iran,” Tehran Times, February 5, 2023, https://bit.ly/45nP0m8.

[5] Saeed Zanganeh Shahraki et al., “Spatial Planning, Urban Governance and the Economic Context: The Case of ‘Mehr’ Housing Plan, Iran,” Land, Vol. 9, No. 5 (May 2020).

[6] Pooya Alaedini and Maryam Jamshidinasab, “Mehr Housing and New Communities’ Right to the City: A Case Study of the Parand Project,” Journal of Community Development, Vol. 7, No. 2 (2015), 241-258.

[7] Banafsheh Keynoush, “Iran’s growing climate migration crisis,” Middle East Institute, January 30, 2023, https://bit.ly/3B07NWw.