Public acquisition of urban land and allocation for housing and urban development in Iran (1979-1988)
This research aims to examine the effects of the urban land acquisition and allocation programme by the government in Iran on the rate of increase of the prices of urban land and affordablity of housing prices for different income groups in the urban areas of the country during the period 1979 to 1988 which was on the basis of the enactment of three Urban Land Laws after the 1979 revolution. The implementation of these laws limited private ownership of vacant urban land in the country to about 1,000 to 1,500 square metres, depending on the size of the city, with the excess land being acquired by the government. In this respect the Urban Land Organisation under the Ministry of Housing and Urban Development was able to acquire 36,000 hectares through confiscation from the excess of private ownership, 8,258 hectares of private land in return for payment of compensation, and a further 41,272 hectares of land which already belonged to the various public organisations was transferred to its authority. Thereby a total of 85,557 hectares was assembled under the authority of the urban land organisation (ULO). As part of the land policy, the ULO then proceeded to allocate some 10,790 hectares or 12.6 percent of the total assembled land to eligible applicants including private households, housing cooperatives and public and private housing developers for housing construction. This was in addition to the 3,313 hectares or 3.9 percent of the total assembled land which was allocated for the purposes urban services and commercial buildings. In any case, while only 12.6 percent of the assembled land was allocated by the ULO it comprised about 32 percent of the number and 34 percent of the area of land plots for new starts of housing construction during the period 1979 to 1988. The hypothesis of the thesis with regard to the effect of government acquisition and allocation of urban land on the situation of urban land prices and housing in Iran is that between 1979 to 1988 this programme and the resultant activities has on the one hand led to a reduction of the rate of increase of the price of urban land in the market and, on the other, has contributed to the provision of affordable housing units for low and middle income households. The thesis has tested the first part of its hypothesis by collecting and analyzing the trend of development of urban land prices for a 15 year period between 1974 to 1988. The second part of the hypothesis has been tested by calculating the price of housing on ULO allocated and privately owned land and then comparing them with the effective demand of different income groups in the urban areas of the country. The evidence of the analysis for the first part of the hypothesis shows that during the period 1979 to 1988 the average price of one square metre of privately owned land was about 13 times higher than ULO allocated land. More importantly, however, is the trend of development of the price of privately owned land between 1974 to 1988 which shows that after the 1979 revolution average prices of privately owned land always kept below the 1976 figure prior to the revolution and from 1985 on wards the actual increase at constant prices was actually negative. Moreover, with the base year of 1974, the index of the average price of privately owned land for the period 1979 to 1988 was between 58.7 and 207.5 which was much lower than the consumer price index which was between 196.3 and 974.1 for the same period. The index of the average price of urban land for 1975 and 1976 prior to the 1979 revolution, however, is 125.3 and 170.5 which is higher than the consumer price index for the same period which was 109.9 and 128.1. consequently, it can be stated that the evidence from the analysis for the first part of the hypothesis supports its proposition in that the enactment and implementation of the aforementioned urban land policy after the 1979 revolution has led to a reduction of the rate of increase of urban land prices in the market between the period 1979 to 1988. The result of the analysis for the second part of the hypothesis on the other hand shows that on the basis of the recommended floor area of 75 square metre for housing units built on ULO allocated land, which was recommended by the Ministry of Housing and Urban Development, such units were in the main affordable to all income categories including all those in the low income groups. The units built on privately owned land were in the main only affordable to income groups 8-10 which comprised the high income groups and in 1987 and 1988 even income groups 8-9 of the high income groups were excluded from these units. More importantly, however, the analysis shows that even with bigger floor areas including the actual average floor area of urban housing units for the period 1979 to 1988, which ranged between 132 to 162 square metres during the stated period, the units built on ULO allocated land were still much more affordable to the low and middle income groups than the units built on privately owned land which would still be in the main unaf fordable to the low income groups. This difference in affordablity also applies to small units 50-75 square metres built on the two different categories of land. The result of the analysis for the second part of the hypothesis, therefore, also supports its proposition in that the enactment and implementation of the aforementioned urban land policy after the 1979 revolution has contributed to the provision of affordable housing units for low and middle income households in the period 1979 to 1988.