LAND MARKETS AND HOUSING DYNAMICS IN LOW INCOME
SETTLEMENTS IN IRAN:
EXAMINING DATA FROM THREE CITIES
***Draft Version 2***
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Pooya Alaedini
Assistant Professor
University of Tehran
Uwe Deichmann
Development Research Group
World Bank
Helen Shahriari
Europe and Central Asia Region
World Bank
Abstract: This paper contributes to discussions on slum upgrading and housing and land
markets in developing countries by presenting some empirical evidence from an ongoing
World Bank/Government of Iran (UUHRP) social assessment and impact evaluation in
three Iranian provincial capitals. Quantitative and qualitative information was collected
through a comprehensive survey covering a representative sample of dwelling units in
low-income neighborhoods. The paper first examines development dynamics of the
neighborhoods from historical and analytical perspectives. The empirical section of the
paper highlights the consequences of shortcomings in the neighborhoods, followed by an
analysis of the role of property rights in influencing household behavior and economic
opportunities. The paper concludes with a discussion of the implications of the findings
on the design and success of urban upgrading programs.
Key Words: urban slum, housing market, land market, tenure, urban services, Iran
LAND MARKETS AND HOUSING DYNAMICS IN LOW INCOME
SETTLEMENTS IN IRAN:
EXAMINING DATA FROM THREE CITIES
I. INTRODUCTION
Tackling the issue of informal settlements, under-serviced neighborhoods, or what is
generally referred to as urban slums remains a daunting task in a majority of developing
countries under both rapidly-growing and stagnant economic conditions. According to
UN-HABITAT (2003) figures, close to 900 million people or more than 40 percent of the
population in developing countries lived in slum areas in 2001.
Policy-makers are increasingly realizing the large societal benefits from lifting the living
standards in the slums and the untapped economic potential of slum areas that may
largely operate outside the formal economy. The goal of pro-poor urban policies is to
integrate these communities into the urban economy and to increase quality of life and
welfare. Policy interventions to improve living conditions are often delivered as packages
that include outright provision of improved housing; upgrading of municipal
infrastructure and of social and utility services; settlement formalization and titling; and
general regulatory and housing sector reform (UN-HABITAT, 2006).
While there has been considerable investment in urban upgrading programs in recent
decades, solid, empirical evidence on the effectiveness of these interventions remains
scarce. What is clear is that the formation and persistence of urban slums and by
extension the effectiveness of any upgrading program or policies to prevent future
formation of urban slums depend on a number of factors. These include the manner in
which urban land and housing markets function, the level of local participation, the
existence and affordability of urban services, the capacity of local-level institutions to
deliver physical and social services in a general enabling environment that empowers the
residents, and the pro-poor policies the country adopts in relation to the general economic
and employment conditions.
In this paper, we intend to contribute to the empirical evidence on urban slums and on
housing and land markets in a Southwest Asian country, Iran, which has received
relatively little attention from academic researchers. We present some initial evidence
from an ongoing social assessment and impact evaluation in three medium-sized,
provincial capital cities in Iran: Bandar Abbas, Kermanshah, and Zahedan. We show how
the general socioeconomic conditions and the functioning of land and housing markets
give rise to various types of persisting urban slums – from the new informal settlements
to older, more or less formal, but poor inner-city neighborhoods. The general pro-poor
public policies in the form of hand-outs as well as the provision of minimal social and
physical services in Iran mean that the low-income neighborhoods are not shanty towns
with a totally destitute population. However, the low capacity of local-level institutions to
deliver physical and social services in a general enabling environment that empowers
residents, the general unproductively of the formal urban economy, and the
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underdevelopment of community social capital to allow full local-level participation
preclude the autonomous enhancement of the low income neighborhoods and induce
slum expansion.
Information and data collection for this study was undertaken as part of a World
Bank/Government of Iran Urban Upgrading and Housing Reform Project (UUHRP). In
each city, qualitative and contextual information collection was complemented through a
comprehensive, multi-topic household survey covering a representative sample of
households in low-income neighborhoods exhibiting various forms of irregularity.
Besides housing, the surveys covered household living standards and expenditures,
access to services, and community social capital.
In each city, there were a dozen communities that had been identified by the earlier
feasibility studies as under-serviced, irregular, or informal. In each city, 3-5 low-income
neighborhoods were selected as being based on a number of criteria, including
ethnicity/language, level of public service provision, level of regularity and formality,
main economic activities, age of the settlement, and main socioeconomic indicators. The
questionnaire-based survey covered a sample of 1,200 households randomly selected in
the chosen 3-5 target slum areas. The qualitative part of the survey collected information
through both in-depth interviews with key stakeholders and focus group discussions. In
each city, 25-40 key informants (including government official, and non-governmental
representative, and local council representatives, and community informers) were
interviewed. Furthermore, 4 focus groups in each community were conducted: one with
women, one with men, one with the youth and one with both men and women. In
addition, several facility surveys were carried out in each city.
All three cities under investigation have urban slums both inside the city boundaries (that
is, they are formal in the municipal jurisdictional sense, but not necessarily in terms of
individual housing unit tenure or regularity of services) and outside the city limits (that is
they are considered informal by the municipality). This study did not cover those
settlements that fall outside the municipal boundaries in the three cities since these will
not be targeted by UUHRP. While this may be considered a shortcoming of the survey,
the study’s more limited scope highlights the fact that slums tend to persist even after
their status have been formalized to a large extent by bringing them under municipal
jurisdiction. In particular, there is now an ongoing debate in Iran to give present informal
settlements across the country blanket recognition by bringing them under municipal
jurisdiction and “preventing” the formation of any future informal settlements.
In the following sections, after providing a description of the Iranian context, the paper
will first examine the development dynamics of the neighborhoods from both a historical
and an analytical perspective. The purpose is to understand how the settlements were
formed, what the process of urban expansion was, how the housing and land markets
functioned during the formation of the irregular neighborhoods, and what impact
municipal policies and regulations had on settlement formation dynamics.
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The empirical section of the paper will highlight the consequences of shortcomings in the
housing markets in low income neighborhoods of the three cities. The survey data allow
detailed analysis of who lives in these neighborhoods (socioeconomic characteristics,
employment, migration, etc.), residents’ consumption and expenditure patterns that shed
light both on general living standards and on housing related costs, and of access to
public social and infrastructure services. The empirical section will analyze the role of
property rights in influencing household behavior and economic opportunities. The main
angles are access to formal finance that can be invested by the household and willingness
to invest in maintaining and upgrading of the dwellings. Of interest to our analysis is also
the issue of social capital which may foster improved social outcomes such as crime
reductions or community initiatives. The paper will conclude with a discussion of the
implications of the findings on the design and success of urban upgrading programs.
II. URBAN DEVELOPMENT TRENDS AND FORMATION OF SLUM
NEIGHBORHOODS IN IRAN
A major characteristic of Iran’s economy since the 1960s has been a strong dependence
on oil revenues. While oil revenues could potentially provide for big-push economic
growth drives, they have also resulted in a number of structural problems that hinder
equitable development and a sustainable growth pattern. These structural problems
notwithstanding, Iran also experienced a devastating and long war with Iraq that cost the
country close to one trillion US dollars in damages. The results of all these have been
low and sometimes negative rates of economic growth and stagnant per capita incomes in
the 80s and 90s, persistently high rates of unemployment (currently higher than 10
percent) even in the face of close to 5 percent annual growth since 1997 due to the oil
boom (Central Bank of Iran, 2005), and an unequal distribution of wealth. The Gini index
for Iran in recent years has been estimated at 0.419 for urban and 0.424 for rural areas
(Zonuz, 2000); it was calculated at 0.43 for 1990 in a semi-official source (Tabibian,
1999).
Yet, since the 1979 Revolution, Iran has given special emphasis to human development,
social protection, and “social justice.” Significant investments have been made in the
social sector over the last 20 years with virtually full coverage of the elementary and
higher level education, extensive health coverage, and an active distributive strategy
through direct transfers and indirect subsidies. However, the government has dealt with
poverty more through handouts and charitable transfers than through employment and
empowerment. While explicit subsidies and transfers have the merit of reaching the poor,
Iran also maintains, often in the name of the poor, an expensive and excessively large
implicit subsidy system that is untargeted.
A number of government and non-governmental organizations are active in providing
social security both in insurance and non-insurance forms. Non-insurance services refer
to all social work, advisory, and other social rehabilitation activities that are provided to
low-income families as well as a number of other groups. The main organizations active
in this area are the State Welfare Organization, the Red Crescent Society, the Imam
Khomeini Relief Committee, the Martyrs Foundation and Moztaz’afan Foundation. The
latter three are considered non-governmental organizations but receive most of their
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funding from the state. Insurance services are provided by the Social Security
Organization, the Medical Services Insurance Organization, and the State Retirement
Organization. The Imam Khomeini Relief Committee is a super-NGO (very much
affiliated with the public sector). It is basically a charity organization with huge assets. It
provides a number of social services including interest-free loans towards the
engagement of vulnerable groups in productive activities. The Ministry of Cooperatives
has had an important initiative towards poverty alleviation and employment generation to
facilitate the formation of cooperatives, in rural as well as urban areas. The programs of
the above organizations include direct cash transfers, education scholarships, and health
and social security coverage. Many of these programs are offered through the network of
mosques. The country has also accumulated a rich experience of rationing during the long
war with Iraq (Farjadi, F. and A. Pirzadeh, “Planning in Post-Revolutionary Iran,”
unpublished mimeograph, 2001). The Ministry of Welfare was recently established to
coordinate all welfare-related activities in the country. This goal has not yet materialized.
Official sources maintain that the proportion of the population living under the poverty
line has fallen from forty some per cent in 1978 to about 15 per cent in recent years.
While the fact that education and health indicators have shown improvement may not be
disputed, Iran still faces a significant prevalence of income poverty. Overall income
poverty has probably increased. A study conducted for the period 1984-1998 – by
calculating relative poverty rate through counting those households whose expenditure is
less than half of median household expenditure – found that 15.8 per cent of all
households were under the relative poverty line in 1984. The corresponding figure for
1998 was 20.23 per cent. Further, increases in the prevalence of poverty among rural
households were found to have been more severe than urban households (Nili, et al,
1997). Other analysts have even calculated relative poverty at 45-50 per cent and absolute
poverty at 30-35 per cent of urban households (Raisdana, 2000).
As in many other developing countries, Iran experienced an unprecedented population
boom in the second half of the twentieth century. The population of Iran was reported to
be close to 19 million persons according to the 1956 census while the 1996 census
recorded a figure of more than 60 million for the country’s total population. Total
population is now estimated to be more than 70 million persons. While the country’s
rural population has continually increased in the last decades, its proportion to the total
population has shrunk from more than two thirds to about one third of the total
population, based on recent estimates. The urbanization tends have been an inevitable
outcome with much precedence from before the revolution and in particular since the
land reforms of the 1960s. According to census figures, in 1996, around 61.3 percent of
the Iranian population lived in urban areas -- including older cities and towns and villages
that have grown to towns. In particular, the number of cities with populations larger than
100 thousand persons increased from low teens in the middle of the twentieth century to
more than 60 by 1996 (SCI, 2005a).
With such a high rate of population growth experienced in Iran’s urban areas, the need
for comprehensive urban plans was felt in the 1960s and was eventually adopted for most
cities in the country. However, until recent times few of these plans paid serious attention
to the issue of slums. Indeed, a major characteristic of these plans has been quite large
minimum land division allowance for housing purposes. For example, in the first
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comprehensive plan for Tehran, minimum size of land plots was set at 300 square meters
whereas until then the average size of the plots was only 100 square meters. This plot size
was clearly outside the affordability range of the lower income strata of the society.
Needless to say, the result of this regulation was the formation of irregular settlements
wherever possible (Athari, 2003).
Iran’s five-year planning cycle however did start paying attention to housing issues in the
early seventies. In particular the 3rd and 4th pre-revolutionary five-year plans began to
provide some explicit guidelines on low-income housing, attempting to activate the
private sector in this area as well. After the Revolution of 1978-79, government programs
took it upon themselves to address the issue of housing for low-income households. In
particular, provision of land to low-income households was put on the government’s
agenda. This has been achieved through allocation of land to housing cooperatives whose
members by default have been those working for either government agencies or medium
to large size private enterprises. Since significantly more than half of Iran’s employment
is in the micro and small enterprises, the bulk of the low-income population has not
benefited from such programs (Athari, 2003). Furthermore, from the middle of 1990s the
level of land allocation for low-income housing has declined significantly. The same
happened to inexpensive loan allocations for housing (Mehrdad Javaheripur, “Tarhe
barrasiye hashyeneshini”, unpublished, 2006).
What should also be noted in the case of Iran is that, right after the Iranian revolution and
during the war (the entire eighties), the government made the decision to look the other
way with regard to construction regulations due to war expediencies, revolutionary
slogans and the availability of some expropriated lands. This allowed significant irregular
and low quality construction activities which in fact resulted in the ballooning of the slum
areas.
One study estimates that while 70 percent of households in Iran own their housing units,
the income levels of more than 50 percent of households makes it impossible to for them
to purchase a home. Indeed, the price of housing is such that it is beyond the affordability
range of low-income households. Furthermore, the study finds a big gap between average
demand for square footage of housing by households and the larger size housing units
available in the market (Rafii, 2003).
The above issues all point to the reasons for the expansion of urban slums in Iran. Some
sources estimate the current size of slum dwellers in Iran in the 2.5 to 4.5 million persons
range (Mehrdad Javaheripur, “Tarhe barrasiye hashyeneshini”, unpublished, 2006). Table
1 shows the size of slums in a select number of provincial capitals in Iran. It shows that,
in these selected cities, on the average more than 20 percent of the population lives in
slum areas and also on the average close to 8 percent of the city is considered be made up
of slum areas.
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Table 1: Slum Area Population in Selected Provincial Capitals in Iran, 2006
Citywide
Low-income neighborhoods
Total
Total
area
% of
% of
City
Population
(ha)
Area (ha)
total
Population
total
Zahedan
650,000
4,800
1260
26.25
237,000
36.46
Kermanshah
692,986
9,569
739
7.72
270,979
39.10
Bandar Abbas
457,000
5,500
1700
30.91
137,100
30.00
Tabriz
1,191,043
23,000
1452
6.31
243,934
20.48
Sanandaj
325,618
3,561
536
15.05
173,672
53.34
Mashahd
2,400,000
24,000
1000
4.17
650,000
27.08
Ahvaz
1,100,000
22,000
1300
5.91
300,000
27.27
Arak
381,682
2,877
390
13.56
103,619
27.15
Ardabil
391,455
5,715
810
14.17
99,485
25.41
Shiraz
1,053,025
18,951
1808
9.54
180,671
17.16
Ilam
140,301
1,718
202
11.76
31,800
22.67
Hamadan
464,162
9,972
598
6.00
2,439
0.53
Orumieh
520,000
7,570
1180
15.59
146,000
28.08
Khorramabad
382,640
3,695
219
5.93
22,668
5.92
Qom
1,020,000
8,125
315
3.88
90,000
8.82
Saveh
165,000
2,053
244
11.89
18,140
10.99
Qazvin
291,117
6,430
50
0.78
22,000
7.56
Yazd
326,776
13,616
440
3.23
6,000
1.84
Zanjan
286,295
6,393
169
2.64
58,000
20.26
Birjand
127,608
2,776
98
3.53
22,000
17.24
Total/Average
12,366,708
182,321
14510
7.96
2,815,507
22.77
%
inside
city
77.7
70
100
100
100
92
59
100
89.9
100
100
80
78.6
99.8
95
95
100
100
100
98
-
Source: Compiled by National Enabling Taskforce Secretariat, Ministry of Housing and Urban Development
There are two other issues that need to be considered when discussing urban slums in
Iran. First is the fact that since the early 1990s, municipalities in Iran have been supposed
to raise their own funds. But since most cities in Iran have not been very productive in
economic terms, their municipalities have not had much money to invest in the cities and
in particular in the low income neighborhoods. As of the early 1990s municipalities have
tried to self-sufficient, relying on housing taxes, taxes on retail units, and taxes on
building construction/permits. Municipalities are not in a position to directly raise funds
in the capital market.
A major characteristic of Iranian cities is the dual housing market. In the past decade and
a half, the price of housing across all urban areas in Iran has skyrocketed due to the fact
that at last a part of the economy has done well (and real estate has traditionally been a
place where people have tended to put their money). Therefore, in all cities, including the
three under investigation in this paper, a portion of the population pay premium prices for
desirable real estate while at the other end of the spectrum others have to settle in formal
and informal slums (although this does not mean that the price of housing in the lowincome neighborhoods has stagnated).
6
Despite the above, slum areas in Iran fare batter as compared to many other developing
countries. For example the average size of house plots in Tehran is larger than in
comparable developing country capitals. Furthermore, piped water and electricity is
available in most slum neighborhoods in the country and construction materials are for
the most part are of medium quality even if they are not put together properly (Kamal
Athari, et al, “Hashyeneshini dar Iran va rahe halha”, internal report, 1996).
III. CHARACTERISTICS OF SURVEYED CITIES AND THEIR SLUM AREAS
1. Profiles of the Cities
All three cities of Bandar Abbas, Kermanshah, and Zahedan are provincial capitals that
dwarf other urban areas of their respective provinces. Yet, each is located in one corner
of the country and differs from other two in terms of history, (sub-) ethnic background of
its inhabitants, and economic base.
Bandar Abbas, the Capital of Hormozgan Province, is a major port on the mouth of the
Persian Gulf with a long history of trade and fishing activities. Its native population
mainly speaks a dialect of Persian. A significant number of the residents are minority
Sunnis and some African influence on the population may also be observed. The city is
an extremely important trading port and has also attracted industrial investment. Despite
its economic importance, the city itself is not a boom town or an attractive investment
place anywhere close to what one can observe in the port cities on the other side of the
Persian Gulf.
The population of Bandar Abbas increased from 87,000 in 1977 to 273,000 in 1996 and
is estimated to be close to 350,000 persons at the time being. The source of this rapid
growth is to a large degree internal to either the city or to the province. This said,
between 1986 and 1996, Hormozgan received 55,000 migrants from outside the province,
most of whom are reportedly in Bandar Abbas. Together with the rapid population
growth, the city has experienced the formation of low-income communities with various
levels of irregularity in the last 2 decades in either some of the older or more recent
settlements. Our survey focused on five low-income neighborhoods in the city, namely,
Suru, Dohezar, North Nayband, Kamarbandi, Nakhl-e Nakhoda.
The 1980s brought an increase in informal construction activities within the city limits of
Bandar Abbas. Kamarbandi and Do-Hezar communities began to take form in this period
which was followed by a rapid expansion of these neighborhoods. Yet, the older lowincome communities of the city, e.g., Suru and Nakhle Nakhoda, have also faced low
levels of urban service provision and less than standard housing stock in the last two
decades. In the older communities, durable construction materials are used, the housing
stock does not meet minimum construction standards, posing a major challenge in the
case of earthquakes which is also the case in much of the housing stock in the newer lowincome neighborhoods. Furthermore, as in many other low-income neighborhoods in
Iran, little attention is given to the outside of the dwelling units which is considered a part
of the public rather than private space for the residents.
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The current city of Bandar Abbas may now be divided into four parts: 1) the center of
the city and its outlaying areas, which with the exception of a few newly constructed
commercial buildings, has not undergone much change; 2) the newly constructed areas of
the city, in the west and the east of the city (Amirabad and Golshahr), built according to
construction standards; 3) the traditional section of the city, located near the sea and
beach areas, which with the passage of time, has experienced a decline in the quality of
building structures as well as city services (Suru and Nakhle Nakhoda); and 4) more
recently formed slum areas which can aptly be described as the most economically
disadvantaged areas of the city of Bandar Abbas (Kamarbandi and Do-Hezar).
Kermanshah lies to the west of Iran near the Iraqi border. It is an old city having some of
the more important historical sites in the country. Its population is a mixture of Persian,
Kurdish, and Lor who are for the most part of the Shia persuasion similar to the majority
population of the country. The area has a moderate to cold climate and has been
significant in terms of agriculture. Kermanshah was heavily affected by the Iran-Iraq War
in the 1980s with a marked impact on its demographic situation. Population growth in
Kermanshah through both migration and birth has been quite high. It was above 6 percent
in the early nineties. The total population of Kermanshah was calculated as 681,611 in
the last national census conducted in 1996 and was estimated as 816,599 in 2005.
(Feasibility Study of Citywide Upgrading in Kermanshah, UUHRP internal report, 2005).
A total of 13 neighborhoods in Kermanshah were identified as irregular settlements in the
feasibility study conducted for the Urban Upgrading and Housing Reform Project with a
combined population of 225,097 or more than one fourth of the city’s population (Ibid).
Our survey selected three neighborhoods, namely, Shaterabad (close to 60,000 persons),
Dowlatabad (close to 45,000 persons), and Kowliabad (close to 33,000 persons) as
representing Kermanshah’s slum neighborhoods inside the city boundaries. Population
growth in Dowlatabad has been the slowest while that of Kowliabad has been the fastest.
The city of Zahedan, as the capital of Sistan-Baluchestan, is more or less a 20th century
creation. It has been shaped by the presence of the public sector organizations and their
associated employment as well as formal and informal trade-related activities. Zahedan
has been a main point of population attraction in the province, drawing migrants not only
from neighboring towns and villages but also from Southern Khorasan and Kerman
Provinces. The population of Zahedan, at 430,000 according the local office of the
Management and Planning Organization figures, was reported to be four times that of
Zabol, the next large town, in 1996. Average population growth for the period 1996-2002
was 3.82 percent per annum for the whole city of Zahedan. This figure is much higher
than the average for the country. The current population of the city is estimated by the
Management and Planning Organization to be more than half a million. Yet unofficial
statistics put the permanent population of the city at about 700,000 persons with another
150,000 Afghan refugees. Considering the state of affairs in Afghanistan the unofficial
statistics may not very far off (Feasibility Study of a Citywide Upgrading in Zahedan,
UUHRP internal report, 2005).
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Due to the high rate of migration, lack of formal income earning activities for a large
number of urban residents, and initial low-level socioeconomic development of the
communities, there are a number of neighborhoods both inside the city boundaries and
outside that are considered irregular settlements or more appropriately slum areas. These
include Karkhaneh-ye Namak and Posht-e Garage, Babaiyan, Gharibabad, Dare Panjshir,
Nukabad, Chaliabad, Shirabad, Qasemabad, Moradqoli, Sikhsuzi, and Karimabad. This
study chose Karimabad, Shirabad, and Karkhaneh-ye Namak which are inside the city
boundaries and are not considered informal in terms of city jurisdiction for the purpose of
data collection.
All of the above neighborhoods reflect the long transformation of Zahedan’s lopsided and
unsustainable development in their structure. Indeed, Zahedan is a classic example of the
formation of irregular settlement by the urban population surplus together with the newly
arrived migrants. For example, the surplus population of Babaiyan, which is within the
city boundaries, is now building new homes in Darreh-ye Panjshir, Nukabad, and
Qasemabad, all of which are outside the city boundaries. It should further be noted that
migrants from other cities and villages have in general formed the urban population of the
whole city and continue to contribute significantly to the growth of the informal
settlements. The social and cultural backgrounds of new migrants are in continual
interaction with those of the earlier migrants. This cultural and social mixture affects the
built environment in various ways. One of its manifestations is the rise of the irregular
settlements, which are initially informal and are subsequently incorporated into the city
(Ibid).
2. Land/Housing Market and Slum Typologies
As discussed above, all three cities have a significant number of slum areas that fall both
within and outside the municipal boundaries. Furthermore, some of the slum areas that
are now inside the municipal boundaries used to be located just outside the city fringes
and were annexed later by each municipality. Yet, there are also instances of slum areas
that are quite old – in particular in Bandar Abbas – that had in fact formed some of the
core areas of the cities in the past. The older neighborhoods have become low-income
settlements in a downward disinvestment spiral whereby:
i)
Poor households have remained in the neighborhoods with narrow,
meandering alleys and old houses.
ii)
Better off households have moved elsewhere in the city with better streets and
avenues (more upscale) in which they can live in newer houses.
iii)
Some of the new arrivals (poor households) also go to the older
neighborhoods, essentially replacing the better off ones who are leaving.
iv)
The municipality does not provide services to these neighborhoods on a par
with more affluent settlements party due to the former type of neighborhoods’
physical attributes.
The classic case of the newer types of neighborhood is when migrants from outside the
urban area (often rural areas) or poor households already in the city, who cannot afford
regular types of housing offered in the formal market, purchase land in the informal land
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market in areas just outside the city boundary. This is quite possible in Iran since much of
the land on the fringes of the cities is owned privately. What makes this type of land
attractive is exactly the fact that it does not have proper plot division or construction
permits, thus making it much cheaper than land elsewhere. Some documentation is
provided for the transaction, such as a promissory note (qölnâmä or patä). Therefore,
those who purchase this land are more or less the legal owners of their plots, although
they lack construction permits and full titles. Construction on such sites therefore tends to
take place at night and illegally. Municipalities have in the past tried to prevent such
constructions, even bulldozing the buildings the next day. But such tactics have proven
unsuccessful, unpopular, and certainly inhumane. Considering how these types of
neighborhoods start, even when they are incorporated into the city, they are slums (land
divisions are not proper, housing stock is of poor quality, etc.). Therefore, even these
types of neighborhoods go through the downward spiral similar the older types of
neighborhood described above.
Not all of the newer neighborhoods started outside the city boundaries. Some were
originally initiated by the public sector. As mentioned in the previous section, in the past,
the government has provided some land for low-income housing as well as inexpensive
loans in most cities. While across the neighborhoods studied in Kermanshah and Zahedan,
there is little evidence of such allocations, in Bandar Abbas, some parts of Do-Hezar
neighborhood were originally intended for this purpose. However, what soon followed in
the areas right adjacent to the original nuclei of these settlements amounted to a
construction frenzy and perhaps some “land grabs” in the relaxed regulatory environment
experienced in the eighties as suggested above. While some of the construction activities
might have constituted a form of squatting in the eighties, there is little evidence of such
possibilities today. Indeed, currently, very few squatter settlements are reported in Iran in
general.
3. Migration Patterns and Formation of the Slum Neighborhoods
3.1. General Observations
The three cities are different in terms of migration patterns observed in their irregular
settlements. While a large of number residents of Bandar Abbas’ irregular settlements are
more or less natives, there are significant numbers of migrants in Zahedan and
Kermanshah. The major reasons for migration have been finding work or accompanying
parents although marriage and natural disasters were also indicated by some as the reason
behind their migration. In Zahedan, about three fourths of the heads of household have
rural backgrounds. Yet, even in Zahedan as well as in Kermanshah, the population is very
young which means that while the head of household may have been a migrant, the
children have most likely been born in the city. This said, we should not forget that many
of the migrations have taken place in relatively recent times, in the last 20-25 years. As
an example, more than three fourths of the migrants to the irregular settlements of
Zahedan came to the city after the early 1980s. In Bandar Abbas, more than 15 percent of
the households who reported having been migrants in our survey came to the city in the
last 5 years. Yet, 11 percent of Bandar Abbas’ migrants have entered the city before the
10
1979 Revolution. We nevertheless can no longer call these residents migrants, since the
majority of the household members are from the cities themselves. What should also be
noted is that, those who have moved into the low-income neighborhoods under
investigation were from the neighboring areas. The following table shows that in the
majority of cases, the head of household has moved to the present house from somewhere
else in the city. This means that even if the head of household has been a migrant he has
first settled somewhere in the city and then moved to the low-income neighborhoods
under investigation.
Table 2: Whether head of household moved to this house from within the city
Parameter/City
Bandar Abbas
Kermanshah
Zahedan
Head of household moved to
75%
61%
69%
this house from somewhere
else in the city
3.2. Bandar Abbas
By and large, the economically disadvantaged informal dwellings in the communities
being studied have not been formed as a result of migration. Based on survey results, a
large number of residents in the communities being studied have relocated from within
the city to their current communities and a few have relocated within these same
communities. For example, in Do-Hezar and Kamarbandi communities, 70% of the
population has relocated from other areas. The majority of these relocations occurred
during the period 1980-1995. Whereas rural-urban migration is a main theory explaining
the formation of low-income and informal neighborhoods, the results of survey in Bandar
Abbas indicate the following. Approximately 85% of the total population of Bandar
Abbas was born in this city and approximately 15% are migrants. Older areas of the city
like Surou, Nakhle Nakhoda, and even North Nayband, attract a smaller number of
migrants, whereas the communities of Do-Hezar and Kamarbandi, with 43% and 23% of
migrants respectively host the largest share of this population. The timing of migration
reflects the expansion of the city. For example, prior to 1978, Kamarbandi and Do-Hezar
communities with 57% and 28% respectively hosted the largest population of migrants.
This trend continues until the 1380’s (2000s) at which time it is reversed, so that the
majority of migrants at this point choose Do-Hezar as their place of residence (51%).
3.3. Kermanshah
The nucleus of the neighborhoods under investigation in Kermanshah was formed by
migrants from outside the city. However, considering the fact that the population in the
slum neighborhoods is quite young, most residents have actually been born in the city.
Most household members had originally come to Kermanshah accompanying their
families or attempting to find jobs. Across the neighborhoods in Kermanshah,
households with the same backgrounds and origins form enclaves. Curiously, in
Kermanshah, families coming from towns and villages to the west of the city have settled
in western parts of the city and those coming from towns and villages to the east of the
city have settled in eastern neighborhoods.
11
3.4. Zahedan
Due to arid climatic conditions in Sistan-Baluchestan, migration within the province to
the capital city of Zahedan has been quite strong. There has also been a strong migration
pattern of civil servants from other parts of the country. The surveyed neighborhoods in
Zahedan have been a main recipient of poor migrants from Sistan-Baluchestan rural areas
and smaller towns. Due to the political conditions in the neighboring Afghanistan, a
relatively strong presence of Afghan migrants can also be observed in the low-income
neighborhoods of Zahedan. The majority of migrants have migrated from villages and
rural areas to the city of Zahedan, and most have migrated with the aim of finding
employment. As compared with the other two communities, Karimabad received a
greater number of migrants. These individuals at the time of migration were illiterate and
lack any specific skills. While in the last two decade migration from other cities and
villages of the province has given the main impetus to the expansion of low-income
settlements of Karimabad, Shirabad, and Karkhaneye Namak/Poshte Garage, we can
observe movements to the neighborhoods from other parts of the city in more recent
times. It should be noted that while approximately half of the residents of these
communities, who migrated to the city of Zahedan, don’t believe they have the right to
receive and benefit from city services and programs. At the same time, the children of
these migrants, born in the city of Zahedan and now constituting around 85 percent of the
residents, feel it is their right to receive services.
4. Demographic Make UP
As the surveyed neighborhoods have been drawn from three different cities in various
corners of Iran, different ethnic groups reside in them. Yet, there is also diversity in each
city as well as diversity within each neighborhood. Differences in terms of expenditure
profiles across various ethno-linguistic groups were hard to establish.
In Bandar Abbas, about 80 percent of the sample households were found to be Shia and
20 percent Sunni. There was a small percentage (0.5 percent) of other religious groups.
Furthermore, around 95 percent of the household speak Persian as a first language. The
rest reportedly spoke various languages, including Baluchi, Pashto, Kurdish, Arabic, and
Turkic.
In Kermanshah, across the neighborhoods, 78.8 percent of the households were found to
be Shias, more than 15.6 percent were found to be Sunnis, 5 percent belonged to other
Islamic denominations (presumably including Ahl-e Haqq as well), and 0.6 percent were
reported to be Jewish. The majority of residents across the neighborhoods reportedly
spoke Kermanshahi Kuridsh (81.9 %) while 6.6 percent spoke Persian, 5.4 percent spoke
Awrami Kurdish, Kurmanji Kurdish, Turkic, etc. No major inter-religious or inter-ethnic
conflicts were reported in Kermanshah’s neighborhoods in the qualitative part of the
survey. Furthermore, results from the qualitative survey show that the majority of
Dowlatabad residents were Sunni Muslims whereas the majority of residents in
Shaterabad were Shia Muslims. Kowliabad was found to have a mixed population
12
although if we include Kowlis (Gypsies) who indicated Shiism as their religion, then the
majority of this neighborhood’s inhabitants will also be considered Shia.
One group, the Gypsies, were reported to be extremely tight-knit within Kowliabad but
was said to have very little relationship with the neighbors from other ethnic groups. In
fact, it was reported that there had been some adversarial relations between the Gypsies
and others, so much that families from other ethnic groups have attempted to expel the
Gypsies on several occasions in the past.
Most residents of the surveyed neighborhoods of Zahedan were found to be Sunni
Muslims (83.2 percent) while the remainders were reported to be Shias according the
questionnaire-based survey. The main languages spoken was found to be Baluchi (83.2
percent), Persian (15.3 percent) and Pashto (1.6 percent). With a minimal advantage, the
Shiite population was found to fare better in terms of expenditure profile as compared
with the Sunni population. The majority of the Baluchis were found to live in the
community of Shirabad and the majority of Sistanis (Persian-speaking) residents lived in
the community of Karkhaneh-ye Namak. The questionnaire-based survey also indicated
that 95.7 percent of the household were monogamous, while the rest comprised
polygamous marriages. Some of the plural marriages in fact comprise more than one
household.
The population of irregular neighborhoods across the three cities of Kermanshah,
Zahedan, and Bandar Abbas are very young. Indeed, the majority of the inhabitants are
under 25. There are more males than females, potentially as a reflection of both low
levels of human development in the communities as well as the greater possibility of
male versus female migration to the neighborhoods. In all three cities, the number of
household members who are from the extended family (e.g., grand parents, aunts and
uncles, etc.) is rather small. This shows that sample households are for the most part
nuclear rather than traditional and extended. Indeed, average household size is about 5
which is the norm in Iran. Two to 3 percent of household members have some form of
disability. There are household members who do not have proper Iranian birth
certificates/national identification booklets. This is particularly the case in Zahedan
(around ten percent of household members) but such individuals also exist in Bandar
Abbas and Kermanshah at the level of one percent of all household members. Children
lacking birth certificates/national identification booklets will have difficulty attending
school while adults who do not have this document cannot engage in a number of
transactions. Absence of birth certificates/national identification booklets is most likely
due to the families or at least its male head being migrants from a neighboring country,
but also due to other factors. There are a small number of female-headed households,
which are more likely to fall in the lowest consumption quintiles.
As the surveyed neighborhoods have been drawn from three different cities in various
corners of Iran, different ethnic groups reside in them. Yet, there is also diversity in each
city as well as diversity within each neighborhood. The survey could not establish
differences in terms of expenditure profiles across various ethno-linguistic groups.
13
The study found literacy rates to be different among the three cities. Bandar Abbas
neighborhoods have the highest literacy rates (above eighty percent) while slightly more
than 50 percent of residents in the irregular settlements of Zahedan have at least basic
literacy. Kermanshah falls in between. Across the three cities, we find a strong
generational improvement in terms of literacy. In particular, in Zahedan and Kermanshah,
the parents of a large number of residents were found to be illiterate. There is also a
strong positive migration impact on educational attainment. Furthermore, educational
achievements are not high although they are much higher in Bandar Abbas than in
Zahedan. Primary school enrollment is respectable in Bandar Abbas, acceptable in
Kermanshah, and less than satisfactory in Zahedan. In Zahedan, 8-9 percent of children
between the ages of 6 and 11 are not in school. The figure goes above 52 percent for
those between the ages of 15 and 18. Figures of school attendance are lower for girls than
boys across the cities, but the difference is much more severe in Zahedan.
The main reasons for not attending school were found to include not being able to cover
costs, needing to work, lack of access to facilities, , and believing that school does not
teach anything. Furthermore, for a significant number of females, the reason for nonattendance was the household’s belief that the local schools were not appropriate places
for girls. The latter was found to be particularly the case in Zahedan. Those with higher
degrees more often fell within higher consumption quintiles and those with lower levels
of education were found in the lower consumption quintiles more frequently.
5. Employment
Unemployment (overt and seemingly hidden) was found to be high among the household
members in working age across the three neighborhoods. This was found to be
particularly so among the younger population as compared to those above forty years of
age. Furthermore, unemployment is higher among women than men and women’s
participation rate is also much lower for as compared to men.
Household ties to agricultural activities to a large extent depend on farming and animal
husbandry possibilities available in neighboring areas. In Kermanshah, around 10 percent
of the households have agricultural lands or are involved in some agricultural activities
near the city or somewhere in the province. The corresponding figures for Bandar Abbas
and Zahedan are 4 percent and 1.5 percent respectively. Needless to say, in the latter two
cases, agricultural activities are severely limited by climatic conditions. A large number
of households across the irregular neighborhoods of the three cities keep poultry but very
few keep other animals at home.
Across the irregular neighborhoods of the three cities, there are a large number of
household members reported to be self-employed. Interestingly enough, there are also a
relatively significant numbers of household members who work for the public sector. For
example, in Kermanshah, close to 35 percent of household members who are employed
work for either the public sector or publicly-owned firms. There are fewer cases of public
sector workers in Zahedan than in the other two cities.
14
Furthermore, the informal economy is relatively large across the neighborhoods of the
three cities. Overall, across the three cities’ irregular neighborhoods, places that provide
employment for the residents are not far away. In some cases, there are nearby markets in
which some of the residents are active. In others, there are places of employment within
the settlements. There is also some evidence of home production.
In Bandar Abbas, the main employment opportunities were found to be available for
laborers, drivers, fisherman, and office workers. Around 50% of those employed in the
communities being studied were engaged in the first three sectors and 23% were
employed as office workers. 19% and 17% of respondents indicated that they were
working as drivers and fisherman respectively. Approximately 75% were employed as
full time staff, and 23% are self-employed or independent contractors. Results from the
study indicate that approximately one third of the non-self-employed worked for the
private sector workshops, 35% were employed in the public sector, and another one third
were employed by individuals. Findings further indicate the following. About 18 percent
of the respondents worked with vehicles, while around 54 percent worked in an office,
store, or a workshop. Also, about 16 percent worked on the sea. Unemployment, in
general, and unemployment among youth in particular, were identified as major
challenges for the communities involved in this study during group discussions.
Approximately 35% of trips made to employment locations were on foot, 21% are made
through shuttle services provided by the employer, and 19% used private vehicles for
transport. Use of public transportation to place of employment was limited at only 4%,
pointing to the lack of transportation services and infrastructure in these communities.
Further, a small percentage of survey respondents indicated the types of supports they
would need with respect to employment (only 1/6th of the families responded to this
question). However 60% of these respondents indicated that loans could serve as a
suitable solution and support for addressing some of their employment needs and
problems.
Each of the neighborhoods in Kermanshah is near an area of employment concentration
such as vegetable markets or car repair shops which provide some level of employment.
A large number of household members have secondary employment while no major
difference was observed in the welfare outcome of this observation. Furthermore,
unemployment is a major problem in Kermanshah’s neighborhoods (supposedly only 30
percent have official work). Rate of participation for women is very low. A large number
of people do not have regular employment. Unemployment is much more pronounced
among those who fall in lower expenditure quintiles. Of those who are employed, 45.3
percent were found to be self-employed while the rest work for employed mostly as
laborers. Of those who are employed by others, close to one third work for the public
sector and another one twentieth work for publicly-owned firms. The extent of
involvement in informal activities was also found to be large. Furthermore, some of the
informal sector activities are illegal, in particular in the Iranian context with an alcohol
prohibition in place. Despite the large unemployment rate, job sustainability was found to
be strong. At the same time, close to 60 percent of employed persons do not have official
contracts. Most respondents were not seeking new employment opportunities. Of the one
fifth of respondents who said they were seeking new employment opportunities, close to
15
60 percent declared need for credit as a prelude. There was a strong relationship between
those who sought new employment opportunities and welfare levels. Those in lower
expenditure quintiles were much more likely to be seeking new employment
opportunities. The overwhelming majority of the respondents reach work in less than
hour. Indeed, more than 90 percent of the respondents reach their work places in less than
half an hour. Furthermore, close to 99 percent of the employed respondents do not use
any motorized transport.
In Zahedan, approximately 17% of heads of households reported being unemployed.
Total unemployment figures for the province were 17% in 1375 (1996) and 6.6% for
cities within the province, while in 1383 (2005) the unemployment figure for the
province stood at 14.7%. The highest unemployment rate among these communities is
for Karimabad at 22%, and the lowest rate is for Shirabad at 13%. While Shirabad fares
better as compared to other neighborhoods, the higher rate of employment in this
community is attributed by some to engagement in undesirable, illegal or black market
professions and vocations, such as smuggling. The rate of unemployment is higher
among illiterate populations and lower among literate groups. Indeed, 60% of illiterates
are unemployed, while only 40% of literates are unemployed. The majority of heads of
households are simple laborers and the majority of those working as laborers are illiterate.
In fact, the number of illiterate laborers is twice as high as literate laborers. In terms of
their type of employment, most of heads of household are employed in the construction
field. In the 1375 (1997) census most of the residents in the city of Zahedan were
employed in this sector, possibly indicating an increase in construction projects and
expansion of the city of Zahedan. Approximately one-fourth or 18% of those employed
are engaged in the public or government sector. National figures indicate that 24% of
employed populations were engaged in the public and government sectors in 1381 (2002).
Most heads of employed households do not have employment contracts with their
employers. The absence of employment contracts, indicate that these employees lack
legal support with respect their rights as workers and workers insurance. As such, in
cases of problems, disagreement and conflict, these employees are not able to take their
cases to court.
What is important is the extent of the informal economy observed in all the
neighborhoods investigated across the three cities. Evidence from the quantitative part of
the survey but more importantly qualitative investigations reveal a large number of
residents across the three cities involved in informal activities. The extent of the informal
and illegal economy is the largest in Zahedan. Indeed, the city’s location allows easy
cross-border smuggling while lack of employment opportunities for low-skilled workers
pushes the populace towards such activities. There are also some smuggling in Bandar
Abbas and Kermanshah but more importantly a large informal as well as illegal economy.
6. Expenditure Profile
The quantitative part of the survey collected a large set of data on consumption which
allowed the calculation of accurate consumption aggregates in the selected low-income
neighborhoods of each city. In particular, the survey team was able to produce figures for
16
adjusted annual per capita consumption (total consumption divided by adjusted number
of households members based on age). The average adjusted per capita consumption
figures are provided for each city in the table below.
Table 3: Consumption aggregate figures (9200 rials = 1USD)
Parameter/City
Bandar Abbas
Kermanshah
Average adjusted annual per capita
6,433,330
5,650,000
consumption (rials)
Average monthly consumption
expenditure for a family of five (rials)
Average annual consumption
expenditure for a family of five (rials)
Zahedan
5,133,870
2,680,540
2,354,160
2,139,110
32,166,480
28,249,920
25,669,320
As may be observed in the table, the consumption aggregates are comparable across the
three cities. One would also predict the figures to be higher in Bandar Abbas than
Kermanshah and in Kermanshah than Zahedan based on the other attributes of the lowincome neighborhoods. Based on the survey results consumption quintiles were also
created to probe consumption diversity in each of the cities. It was found that across the
three cities the average adjusted annual per capita consumption in the highest quintiles
was 2-2.5 times the figure for the lowest quintiles. This shows that while there is some
diversity in the low-income neighborhoods in all of the three cities, the differences are
not extreme. Furthermore, the survey found some differences across the low-income
neighborhoods in each city. Indeed, some neighborhoods were found to be better off than
others.
Yet, to be able to say something meaningful about the level of poverty in our low-income
neighborhoods, we must provide some comparisons. This was done for Bandar Abbas but
with clear implications for the other two cities. The comparison was made between our
survey results and the results of the Household Income and Expenditure Survey
conducted by the Statistical Center of Iran (SCI) in 2004 (SCI, 2005b). Based on SCI
figures, the average annual urban household expenditure at the national level and in the
capital city Tehran were 51,478,920 and 67,258,420 rials respectively. The figure for
Hormozgan Province with its only significant urban area being Bandar Abbas was
reported as 65,831,000 which is not that different from those cited for the country as a
whole and for Tehran. But it is twice as large as the figure of 32,166,480 calculated based
on our survey results. Indeed the average figure calculated based on our survey results
shows that households in the low-income neighborhoods of Bandar Abbas basically fall
within the lowest third of expenditure bracket among all urban households.
7. Housing
7.1. Size, Age, and Shape of Houses
Table 4 provides summary information on size, age and shape of housing units in the
low-income neighborhoods across the three cities. The majority of residents across the
irregular neighborhoods of the three cities live in separate houses. In Bandar Abbas, due
17
to the climate, the houses are stand-alone, but in the other two cities, the separate houses
are attached to each other on the sides. The parcels of land that the houses occupy are not
small. This said, in all three cities, under one third of the land parcels are under 50 square
meters. The building are also not very small, although in many cases the households only
use part of the building for residential purposes, and in a large number of cases the
houses have two rooms or fewer. In all three cities, many of the housing units are also
used for economic activities. Since the neighborhoods are either old or are the ones that
have been formed without any regulation (previously outside the city boundaries), land
divisions are not done properly and the neighborhoods have meandering small streets that
make the provision of services difficult.
Table 4: Size, Age and Shape of Houses
Parameter/City
Bandar Abbas
Kermanshah
Zahedan
Percent separate house
95%
87%
84%
Age (years)
25-30
20-35
10-20
Average size of land (sqm)
204
newer houses
smaller
7% under 100
46% 100-200
47% over 200
Average size of building
(sqm)
123
27% under 50
54% 50-100
11% 100-150
8% over 150
83
Average number of rooms
2.5
2
33% under100
55% 100-200
11% over 200
2
Construction materials
Average
Average
Low to Average
Construction Standards
Low
Low
Very low
In Bandar Abbas, houses are of a reasonable size for the most part. The average and
median size of plots are 204 and 160 sqm respectively. Plots measuring 100 sqm meters
or less make up only 18% of residential dwellings. The Average and median size of the
buildings are 123 and 100 sqm meters respectively. The average and median size of free
land (not used for housing) within existing residential units are 79 and 50 sqm
respectively. These open spaces can allow for refurbishing and improvement efforts or in
the construction of multi-unit complexes. In Bandar Abbas, 70% of housing units in these
communities are single units with yards and approximately 25% are attached single units.
The average and median number of rooms per household are 2 and 2.5 respectively. The
percentage of households with 2 and 3 rooms, which represent the highest percentages,
are 39 and 32 respectively.
In Kermanshah, the survey in the neighborhoods found that 26.9 percent of the houses are
less than 50 square meters, 53.8 percent of houses had land between 51 and 100 square
meters, and the rest are larger than 100 square meters -- for the most part under 200
meters. The built area of the houses is less than 50 square meters for 29.8 percent of
houses, 53.8 percent are between 51 and 100 square meters, and the rest are more than
100 square meters but for the most part less than 200 meters. In Kermanshah, while most
houses have yards, in many cases these are covered and used as some form of a living
18
space. Furthermore, 94.9 percent of the houses are used for residential purposes only
while the rest are also used for economic activities. In Kermanshah, not much difference
was observed across the expenditure quintiles in terms of the size of the house. While in
Kermanshah the houses do not seem to be that small, the qualitative research indicated a
general complaint about the high level of population density and lack of space.
In Zahedan, in 45 percent of the cases, households live in 1 or 2 rooms. Considering the
average large size of the households, the houses are rather cramped in terms of room. Yet
sizes of the land parcels on which the houses sit are not small compared to the rest of the
city. Only about 7 percent of the houses are under 100 square meters. At the same time
the built area for more than 50 percent of the households is less than 100 meters. All
houses have yards. In Zahedan, there is a positive relationship between annual
expenditure and the size of the houses. That is, those in the higher expenditure quintiles
are more likely to have larger houses.
Across the three cities, houses are made for the most part of medium quality materials but
they are not constructed according to standards and are therefore of low quality overall.
This is particularly problematic since all three cities are near major earthquake fault lines.
Yet, the materials are also diverse and somewhat different within the three cities.
Depending on the city, around 10-20 percent of the housing stock seems to be makeshift.
There are also houses that are built with relatively good materials and within the
standards.
In Bandar Abbas, unattached single units with yards serve dual purposes of importance: 1)
they allow for the flow of air reducing humidity; and 2) they allow for reduced damage
from earthquakes, an important point, since the region is earthquake prone. The walls
and roofs of these units are constructed from solid and long lasting materials
(cinderblocks and cement). Nevertheless, it should be noted that these structures do no
meet minimum building code standards. In Zahedan, the quality of houses is for the most
part low, although in many cases the materials seem to be of adequate quality, in reality
the houses have been constructed in a makeshift manner and cannot for example
withstand a moderate earthquake. Overall, it seems that Zahedan is doing the worst in
terms of building materials and Bandar Abbas the best, although Zahedani houses tend to
be more spacious.
Across the three cities, but more so in Kermanshah and Bandar Abbas, houses lack
proper façade which is a reflection of household priorities. Households seem to pay
attention to the interior of the house but not to its exterior which has something to do with
the public space. This fact together with improper land divisions, the resulting
meandering, and dilapidated street conditions (of which more later) make the settings
quite unattractive.
The above discussion about the quality of houses should be understood in the Iranian
context. Buildings across the country have low life expectancy due to the construction
technology. This means a 30 year old house is already considered old. In Bandar Abbas,
houses are for the most part between 20 and 30 years old. In Kermanshah, around 50
19
percent of the housing stock in the questionnaire sample is more than 25 years old (up to
50). Houses in Zahedan are between 10-20 years old. Since the houses in the low-income
neighborhoods were of low quality to begin with they are expected to need major repairs
and reconstruction in the near future which may be beyond the means of many
households.
7.2. Land Acquisition, House Ownership and Title
Table 5 summarizes the survey findings on land acquisition, ownership, and title. Level
of ownership across the three cities’ low-income neighborhoods is not low. Bandar
Abbas has the lowest number of renters or those who reside in the house for free (one
fourth) whereas in Kermanshah around two fifths of the households are renters or reside
in the house for free. Across the three cities, a positive relationship was found between
ownership and consumption levels. Those reported owning their houses tend to fall in
higher consumption quintiles.
Among those who reported owning their homes, in Bandar Abbas and Zahedan, half
claimed having some documents while this claim was made by around one third of the
owners in Kermanshah. However, there are various types of documents including
promissory notes [qölnâmä]. Even in the older neighborhoods, households may have
divided the larger land plots into several houses without permit which makes the house
without full title. Within the group claiming to have documents, one third, 28 percent,
and 97 percent reported full titles in Bandar Abbas, Kermanshah, and Zahedan
respectively. Clearly, Kermanshah is in a much worse situation in terms of ownership and
title among the three cities investigated. Furthermore, in Kermanshah, as in the other two
cities but more strongly, there is a positive relationship between ownership and
consumption quintiles. Those in higher expenditure brackets are much more likely to own
their dwellings.
Table 5: Land Acquisition, House Ownership and Title
Parameter/City
Bandar Abbas
Kermanshah
Zahedan
Percent built own house
74%
16%
67%
Land claimed to be purchased
by current owner
Percent ownership
52%
15%
88%
75
61
63
Relationship between
ownership and consumption
profile
Percent rental or free of
charge
Having ownership documents
among those who are owners
Having full title among those
who have some documents
Positive
Positive
Positive
25
40
37
51
32
48
75
28
87
20
Table 6 provides information on housing repairs. Overall, across the three cities slightly
more than one fifth of the sample households reported having made various kinds of
repairs to their houses. This is a reasonable figure and shows that the households do
invest in their homes despite their low levels of income -- although not necessarily in
upgrading the façade which has something to do with the public space. The second and
third rows show those who reported owning their houses were more likely to make
repairs to their houses. However, the fourth and fifth rows indicate that having documents
for one’s ownership does not affect the chances of making repairs. Similarly the last two
rows show that type of documentation does not determine the chances of making home
repairs. These findings may be explained by the fact that in Iran there is very little threat
of eviction by the local authorities once a neighborhood is established. Furthermore,
housing is considered to be an asset for families which can increase in value over time,
especially if there are structural or service improvements to the property.
Table 6: Housing Repairs
Parameter/City
Percent of total who made repairs
last year
% of house owners who made
repairs
% of non-owners who made
repairs
% of owners with documents who
made repairs
% of owners without documents
who made repairs
% of owners with documents who
have full titles and made repairs
% of owners with documents who
do not have titles but made repairs
Bandar Abbas
21
Kermanshah
21
Zahedan
22
25.5
30.7
27
16.1
6.6
13
23
36.4
21.5
28.5
27.8
32.8
24
39.4
21.5
28
34.9
20.9
In Bandar Abbas, close to one third of households have built their own houses in the lowincome neighborhoods. Zahedan also has a large percentage of self-constructed houses.
In Zahedan, the land in many cases was purchased about 20 years ago which is in line
with the qualitative findings that after the 1979 revolution, rural-urban migration took a
new impetus to the city of Zahedan. The comparable figure for Kermanshah however is
rather low (16%). A similar pattern may be observed for those owners claiming to have
purchased the land. However, there seems to be some discrepancy between selfconstructed houses and purchases of land by current owners in the figures. The
discrepancy in Bandar Abbas has less to do with squatting than getting the land for free at
an early date due to inheritance or traditional possession. In Zahedan, the discrepancy
may have to do with the wording in the questionnaire. The low percentage of residents
reporting self-constructed houses in Kermanshah may indicate a high level of mobility in
that city as compared to the other two localities.
It should be noted that the above figures are aggregates across the studied neighborhoods
in each city and there are certainly variations among the neighborhoods. For example, in
21
Bandar Abbas, in the older communities, such as Suru and Nakhle Nakhoda,
approximately 80% of the housing units have been built by those who currently occupy
the unit. In Nayband and Kamarbandi this figure is 70% and in Do-Hezar it is 61%.
These figures indicate that in Do-Hezar and Kamarbandi communities a second
generation of families has appeared who have purchased homes and are now occupying
these units. In terms of ownership deeds, in Do-Hezar 32% of families have deeds for
their properties, while in Kamarbandi 52% have deeds and in Nakhle Nakhoda only 23%
have deeds. Almost all the families who do not have property deeds, do not pay taxes to
the municipality of Bandar Abbas, and in fact only 38% of residents with property deed
pay local taxes. Some of the housing units in Do-Hezar and Kamarbandi communities
have over time been incorporated into the limits of the city and as such they receive
services from the municipality—making them both informal because of lack of deeds, but
formal because of services provided. Because the city does not receive sufficient taxes
from these communities, only minimal services are provided.
7.3. Water Discharge, Kitchen, Bath and Toilet
Around 60 percent of all houses in the three cities were found to have separate kitchens.
The rest use other rooms in the house or cook in the yard for the most part. Furthermore,
about 75 to over 95 percent of the households have sanitary toilets. The worse case is in
Zahedan where more than one fifth of the houses used pit toilets. A good majority of
households across the three cities also have baths, although again the case of Zahedan is
somewhat worse. In all cities, qualitative components of the survey showed that part of
the waste water – not from the toilet or bath – flows into the streets and open ditches
which is a health hazard -- although swage is also available for some households and of
note is that this situation is not confined to the low-income neighborhoods.
Table 7: Water Discharge, Kitchen, Bath and Toilet
Parameter/City
Bandar Abbas
Kermanshah
Zahedan
Sanitary household water
discharge
Separate Kitchen
75%
99%
85%
64%
63%
60%
Bath
90%
65%
45%
Sanitary toilet
95%
96%
74%
To elaborate further on the above, as an example, in Bandar Abbas, while approximately
64% of housing units have separate kitchens within the housing unit, 13% have
designated space within an existing room for cooking and in 16% of these units the
kitchen facilities are located in a space outside the housing unit. 95% of housing units
have standard toilets with appropriate sewage systems. Most housing units include baths,
but approximately 25% of them do not enjoy sanitary sewage systems. In Do-Hezar and
Kamarbandi communities unsanitary sewage systems are at 60% and 40% respectively
and in Nayband these facilities are at 20%. It should be noted that because of the quality
of the ground, sewage systems pose a problem throughout the area.
22
7.4. Housing Prices and Sources of Financing
Housing prices have been on the rise across Iran in the last decade due to various
macroeconomic and demographic factors (a result of which has been the rise of slums).
This does not mean housing prices in the more established low-income neighborhoods,
indeed those covered by our survey, are low or stagnant. Housing prices reported by
residents for similar units are by no means low which point to the lack of healthy housing
dynamics in Iran. Rental fees are relatively high as well for a certain percentage of
households and in many instances sharp rises in the price of housing and rental fees are
reported – although not in all. As an example, in Bandar Abbas, the cost of purchasing
housing units can serve as an indicator for the financial capacities of the families residing
in the communities under study. The average and median cost of housing, as indicated
by residents themselves, are 120 and 150 million rials (13,000 to 16,000 USD)
respectively.
The housing price dynamics restricts home starts and thus makes it difficult for young
people to move out and start families. This is exacerbated in Iran in general and in the
three cities under investigation due to the very low age of the population. It is easy to see
how as this young population comes out of age and needs to become independent, the
magnitude of the problem will just become much larger. 1
As the following table shows, across all cities, increases in the price of housing have been
reported. In Bandar Abbas, the legal status of properties and the presence of legal deeds,
also impact the cost of housing. Approximately half of the families who possess official
deeds for their properties felt that the value of their properties had significantly increased
in the past 2 years (51%). Only 38% of those who did not posses deeds felt that the value
of their properties had increased over the past two years.
Table 8: Housing Price
Parameter/City
Increased
recently
housing
price
Significant
variables
in
determining housing price
Bandar Abbas
51 percent with
deeds saying sharp
increases
38 percent without
deeds saying sharp
increases
Distance to center,
community itself,
ownership
deed,
size
Kermanshah
Zahedan
65% stating sharp
increase
27% stating sharp
increase
51% stating some
increase
Community
ownership
size
Community
ownership
size
itself,
deed,
itself,
deed,
A regression analysis was conducted in the three cities using the data from the survey to
find the significant variables determining housing prices. The only significant variables
were size, ownership deeds and distance to the center (in case of Bandar Abbas) and
community itself. This finding may not be surprising if we take into consideration that it
is the land itself that is the scarce commodity.
1
On the issue of the youth, see World Development Report, 2006.
23
As indicated in the following table, the most important sources of housing finance are
those from the household itself followed by informal borrowings with no interest (from
family and friends). It should be noted that the survey also found that a large percentage
of households do have accounts at banks which means that they are not estranged from
the banking system. In Iran it is possible to get a housing loan from the Housing Bank if
you hold an account for a certain period of time with a specific amount. Thus, findings in
the table may be interpreted in two ways. First, the households are generally poor and
although the do have banking accounts and can potentially get housing loans, the full
amount of loan from the Housing Bank does not cover the price of a unit in the more
formal housing markets. Second, due to the fact that many of the houses do not have full
titles in the low income neighborhoods, the houses cannot be used as collateral against
the loans. This is a catch twenty two situation. To these problems we should add the high
interest rates due to high rates of inflation prevalent in Iran.
Table 9: Source of Housing Finance (Percent on average for those owning their houses)
Parameter/city
Bandar Abbas
Zahedan
Kermanshah
Own sources
78.25
75.67
74.48
Informal borrowing (no interest)
4.90
10.08
20.53
Informal loan / money lender
7.15
5.07
0.67
Loan from voluntary fund
1.40
0.07
0.05
Formal loan (without collateral)
1.07
2.97
1.32
Formal home loan
5.66
5.41
2.96
Rent to own
Other
1.57
0.73
Total
100
100
100
8. Access to Services
8.1. General Observations
Various types of urban public service provision in Iran are the responsibility of the
representative agencies of government ministries at the local level. The local arms of the
Ministry of Energy are responsible for water and electricity across the country. While the
quality of water may be less than desirable in some locations and not potable in a few
places because of geographic and environmental factors, water is likely to be available in
most places within the municipal boundaries and in many cases beyond. Access to
electricity is even more prevalent. However, several other urban services including those
related to the street conditions and garbage collection are supposed to be offered by the
municipalities which often lack adequate funds or enough capacity to deliver these
services in the low-income neighborhoods. Security is provided by the national policy.
8.2. Water
24
In accordance with the above observations, access to water does not seem to be a major
issue across the irregular settlements of the three cities except in Zahedan where the
available piped water is of a very low quality. But still, in Zahedan, slightly more than
eighty percent of the households are connected to the city’s piped water system while the
rest either buy water, or get water from neighborhood tanks, or get access to piped water
through other families. Water connection is more prevalent among households in the
higher consumption quintiles as compared to the lower ones. Furthermore, in Zahedan, of
those who are connected to the city system, more than 80 percent stated that they had
water 7 days a week and more than 60 percent said they had water 24 hours a day.
Neighborhood tanks are used by close to 7 percent of the sample households. Yet, close
to 50 percent of all households buy potable water which is sold on a daily basis. The cost
of potable water/non-piped water is relatively high. In Zahedan, filtering water is
common and it is done with chemicals for the most part. There are also some households
that have storage tanks, although not a large number.
The other two cities are doing better in terms of access, although there are still some
problems. For instance, FGDs in Kermanshah indicated that the main water problem is in
Kowliabad which is due to its steep slope which translates to low water pressures in the
pipes. This is a major problem with the people especially during summer months. The
main coping mechanism is to store water. In Bandar Abbas as well, around 37 percent of
households store water in various types of tanks (very few households filter the water).
8.3. Electricity
All the neighborhoods in the three cities have no difficulty in accessing electricity in their
homes. For example in Zahedan, 99 percent of households have electricity, although the
prevalence of official connection is lower in lower income quintiles and only 87 percent
have official counters while 7.7 percent are connected unofficially, and 3.9 percent have
deals with neighbors to get electricity based on a fixed amount of payment. Similar of
better patterns may be observed in the low-income neighborhoods surveyed in the other
two cities.
8.4. Sewage and Surface Water Drainage
The availability of sewage depends on how the sewage network in progressing in each
city. In some areas it is more advanced that others. Furthermore, surface water drainage is
a problem everywhere. For example in Kermanshah, in wintertime, surface runoff flows
to peoples’ homes, and in one of the neighborhoods, a main canal that collects surface
runoff has created health hazard and the residents nearby are asking that it be covered.
Whereas in dryer areas, wells which are a relatively sanitary system are used to collect
water discharge whenever a sewage system is not available, in Bandar Abbas which is a
port, this is not possible. Therefore, lack of a sewage network can pose a serious problem
there.
8.5. Garbage Collection
25
The situation of garbage collection is different in the three cities. In Kermanshah,
although for a majority of households across the three neighborhoods garbage in
collected every other day, the qualitative part of the study recorded major dissatisfaction
among the residents with regards to waste disposal and the shortcomings with regard to
the services provided by the municipality. In Zahedan, the majority of households
reported garbage disposal in the open followed by door-to-door collection by the
municipality. Of those reporting door-to-door collection by the municipality, the
responses were equally divided on the frequency of garbage collection among daily, ever
other day, twice a week, and weekly. In Bandar Abbas, in the case of more than 95
percent of the households, garbage is collected directly be the municipality. Across the
three cities, some of those with no access to door-to-door services have dumpster areas
nearby. However, it is also common in the three cities for the garbage get dispersed in the
neighborhoods.
Some fee is paid by some of the households, for the most part basically a tip to those who
collect the garbage through the municipality’s operations. But there are also cases of
some kind of private collection entailing some fee.
8.6. Street Condition
The situation of the streets in the irregular neighborhoods of all three cities is reported to
be unsatisfactory. The two major problems are pavement (as well as surface water
drainage discussed earlier) and street lighting. In the majority of cases, only the wider
avenues have street lighting while street lighting is absent in the smaller streets and alleys.
Furthermore, secondary streets are often not paved. Of course, there are better areas and
there are worse areas. For example, Zahedan is doing much worse that the other two
cities. Yet, the street situation may be considered as less than satisfactory everywhere.
Furthermore, lack of street lighting is a major obstacle for the establishment of security.
This is affecting women and girls much more than males. Almost everywhere, the
respondents believed that it was not safe for women and children to venture out after dark,
and the street lighting seems to have a lot to do with this limitation.
8.7. Public Transport
Public transport does not seem to be a major problem in the neighborhoods, although one
has to remember that transit situation is unsatisfactory everywhere in the cities and
indeed in all Iranian cities. Unregistered jitney cabs are available in the neighborhoods as
elsewhere but the bus system is either limited or non-existent. Since as mentioned earlier
in most cases residents do not travel far away for work, the poor state of public transport
may not pose a serious problem in the residents’ minds.
8.8. Health Facilities
Questionnaire survey results in all three cities indicate that there are a number of
government-owned medical/health facilities available to residents in irregular
neighborhoods. While the questionnaire survey indicated that the level of satisfaction is
26
generally medium or high, FGD participants reported that they prefer going to larger
facilities or private doctors’ offices where professionals with specialization provide
medication services. In particular, residents are not satisfied with health centers lacking a
resident physician. Larger facilities and private practices do not seem to be inaccessible
by residents either. One thing that came out of the FGDs was that some residents do not
have health insurance booklets and cannot benefit from (all) public medical services.
8.9. Security
Security is a general concern, in particular considering the prevalence of illegal activities
and drug trafficking. In many cases, the residents are not satisfied with the work of the
police in providing adequate protection. Findings on the general perceptions in the
neighborhoods are mixed within and across cities. A major dimension of security concern
is for girls and young women. In some cases, parents have to accompany girls to school.
In many areas, drug addicts, drug traffickers, intoxicated individuals roam around and
make the streets dangerous. The opinions expressed regarding the security of women and
children after dark are mixed. Some residents believe that the establishment of some
religious centers in the neighborhoods has improved the situation to some extent. The
shortcomings with regard to street lighting also exacerbated the security problems in
many instances.
8.10. Recreational Facilities
Few households reported access to playground for children, sports facilities, parks,
community centers, video clubs, cinemas, cafes and restaurants, or even telephone booths
– indeed no recreational facilities or places to gather. The only community-type centers
are those affiliated with mosques or other religious institutions. The majority of
households believe that there are not enough recreational facilities available to them.
Many residents believe that the rise of substance and alcohol abuse among the younger
generation of males is at least partially due to this shortcoming.
9. Community Bond, Social Capital and Social Issues
Across the three cities, many residents have strong ties to people with whom they share
some form of origin. However, while religion and language in general may not create any
internal conflict within neighborhoods, sub-cultures comprising households with similar
origins may have very strong internal ties but conflictual relations with other sub-cultures
in their neighborhoods originating in other parts of the province or elsewhere in the
country. Furthermore, qualitative and quantitative information gathered through the
survey show that while at the first glance households within each neighborhood show a
high degree of uniformity, in reality there is some internal disparity in each neighborhood.
Data collected from the questionnaire survey show that the level of positive interaction
among neighbors is quite high (for example helping each other in taking care of children
or borrowing from each other). In particular, borrowing various things from each other
27
and other cooperative behaviors are most prevalent during weddings, funerals, and
various religious/mourning rites.
Conflict resolution among households residing in the neighborhoods across the three
cities is achieved through different means. In Kermanshah, neighbors’ mediation,
followed by the police department were the most cited responses while local community
leaders are also an important means. In Badar Abbas, most conflicts are resolved through
the police department followed by neighbors. Local leaders, religious leaders, and the
city council do not have very much involvement in conflict resolution. In Zahedan, local
leaders, the police, and neighbors were cited as the most prevalent means of conflict
resolution.
The main organizations active in the neighborhoods are health volunteers, religious
groups, and interest-free loan funds (qarz äl-hasanä). There is little evidence of CBOs in
the neighborhoods across the three cities. There are a number of NGOs/GoNGOs,
however, that provide services. For example, two organizations have been quite active in
the neighborhoods of providing support. These included Imam Khomeini Relief
Foundation and the Behzisti Organization. The services these organizations have offered
include provision of nursing services at home or at various centers, educational grants,
employment generation grants, baby formal, housing support, housing repair, healthrelated support including artificial limbs, marriage, travel support, funeral support, and
other things. However, the support has not been give evenly across our three
neighborhoods in Kermanshah. There are also a number of religious associations and the
mosque networks that provide some services to the neighborhoods of the three cities.
Few households stated that they had met with local community leaders for various
reasons. The same was found to be true for meetings with the Municipality officials
although at a slightly higher levels (mostly to obtain licenses or register complaints).
Some households have also met with the member of city council (mostly to get licenses,
register complaints, or for personal reasons) and members of the parliament (mostly for
personal reasons). Household opinions about the impact of these meetings are mixed with
meetings with the local leaders having the higher impact and meetings with local officials
having the lowest impacts. Also, responses were mixed to the question posed on the
effectiveness of the local leaders although more people were of a negative than positive
opinions. Households’ opinion about the municipality were similar to those regarding
local leaders, mixed and to some extent negative, in its provision of better service in
taking care of streets and garbage, in recycling, in establishing public infrastructure, and
in taking care of the aging (opinions get worse in that order).
The spirit of participation and cooperation is high among the residents. However, there is
also a general of sense of disappointment with regards to dealing with public
organizations. For example, more than half of respondents in Kermanshah were willing to
invest in terms of time to take of the streets and collect garbage. Around 43 percent were
also willing to participate in a recycling program, 33 percent were willing to participate
in the establishing public infrastructure, and 47 percent were willing to participate in a
program to take care of the aging population. The respondents also indicated relatively
28
high level of willingness to pay in monetary terms for access to better service,
infrastructure, and maintenance of existing services. Across the cities more willingness to
participate in terms of time was observed as compared to monetary contributions. In
Zahedan, one third to half of the households in Zahedan believe that the residents will
participate in any negotiations on various types of activities to improve the community.
Around 70 to 80 percent of households are willing to provide time and labor to activities
such as negotiating with the municipality, cleaning the neighborhood and disposing
garbage, recycling, taking care of the aging, and establishing and maintaining public
places such as sports facilities. In terms of financial contribution, the figure drops down
to 20-40.
Overall, the qualitative and quantitative parts of the survey indicate that the existing
forms of social capital and social bonds are of the traditional rather than modern type.
Related to this is the issue of the residents of low-income neighborhoods becoming full
citizens. For the type of social capital to
III. CONCLUSTIONS AND RECOMMENDTIONS
Several factors have contributed to the formation and growth of urban slums in the
investigated cities. These factors relate to the macroeconomic environment, development
policy, political orientation including populist policies, history including historical
incidents, regulatory environment including land use regulations, geographic location and
climatic conditions, municipal management, and socio-cultural issues including social
capital. These factors were discussed in this paper and are summarized below:
1. In general, and not confined to the three surveyed areas, economic growth in
Iranian cities is to a large degree contingent upon the level and distribution of oil
revenues by the central government. Furthermore, the oil-dependent
macroeconomic environment encourages capital-intensive operations and land
speculations and does not produce adequate employment in the productive and
formal sector. This means that Iranian cities are not productive enough to create
adequate, gainful employment. As a result, a significant portion of the population
is poverty-stricken and must make ends meet in the informal economy. This
population is also facing a speculative land market and rising land prices.
2. Although land reform and agricultural policy as part of the general development
framework of the country is not necessarily misguided, it has resulted in
accelerated urbanization in the past few decades. The urbanization trend has
translated into unprecedented demand for housing, infrastructure, and
employment in the Iranian cities which require careful policy, planning, and
management beyond the current capabilities of the public sector.
3. Land use regulations on the one side and private ownership (in a speculative
manner) of large parcels of land around the cities on the other translate in to
continual land supply shortages which give rise to significant informal land
29
transaction activities. This is often exacerbated due to regulations governing the
minimum size of land divisions for housing purposes.
4. The revolution and war effects, including those related to migration to the cities as
well as populistic yet unplanned relaxation of the urban regulatory framework in
the 1980s and early 1990s, resulted in the accelerated expansion of the cities in
the form of unplanned and irregular neighborhoods.
5. Specific geographic locations and climatic conditions result in specific urban
outcomes. The proximity of Kermanshah to the war front in the 1980s together
with the high prevalence of rural activities in its vicinity has meant a highly rapid
expansion of the city and its low-income settlements (some of whose residents
still have some ties to the agricultural sector). Sistan-Baluchestan’s arid setting
neighboring Afghanistan and Pakistan has made migration from the province’s
rural areas as well as Afghanistan into the irregular neighborhoods of Zahedan
inevitable and has given rise to significant cross-border smuggling activities.
6. The urban management system in the three investigated cities, and more generally
in Iran, is fragmented. While some organizations providing urban services, e.g.,
water and electricity, have adequate funds for expansion, the municipality needs
to raise extra funds for any extra service provision which may be beyond its
capabilities.
7. More importantly, the municipal management does not have the capacity to
engage the residents of the low-income neighborhoods towards the creation of a
cooperative and empowering framework that can result in enhanced but less
expensive service provision through the transformation of local social capital.
8. Government housing policy through housing cooperatives has not benefited those
working in small enterprises or in the informal economy who make up a large part
of the urban population and more importantly the low-income households.
9. The housing market operates in a way that a portion of the population pay
premium prices for desirable real estate while at the other end of the spectrum
others have to settle in formal and informal slums.
Despite the above environment, significant investments have been made by the
government in the social sector and some forms of infrastructure/urban services. These
include free education and inexpensive medical services as well as the provision of water
and electricity to low income neighborhoods. Furthermore, a number of charity and nongovernmental organizations affiliated with the government have been active in lowincome neighborhoods by providing a range of subsidies and transfers. This means that
low-income neighborhoods in Iranian cities may fare relatively better as compared to
their counterparts in many other developing countries.
30
Yet, as discussed in this paper, in the three investigated cities, there has been an urban
process at work whereby the older, more formal, low-income neighborhoods remain
stagnant or even decline while new informal settlements are formed in the urban fringes
where land can be purchased in the informal market. The latter types of neighborhood
start off at the bottom and, while they may improve upon being incorporated into the city,
they remain poor, stagnant, and under-serviced overall. This paper discussed the
consequences of the described environment in the low-income neighborhoods of the three
Iranian cities located within the municipal boundaries which can be summarized as:
1. High rates of unemployment, underemployment, and employment in the informal
economy are observed across the cities. This situation creates a significant
poverty trap. Even in case of Zahedan where some of the cross-border smuggling
activities are quite profitable, the illegal nature of the activities mean that the
profits are not invested in the neighborhoods. Nor will the money contribute to
alleviating social and cultural aspects of poverty of the households.
2. High incidence of poverty as described through an examination of consumption
levels is observed in the neighborhoods. Indeed the average figures calculated
based on our survey results show that households in the low-income
neighborhoods fall within the lowest expenditure bracket among all urban
households.
3. The housing stock in the low-income neighborhoods is made up of relatively
durable materials in the Iranian context, but it is not built according to standards.
Most houses do have kitchen, bath, and toilet, but their overall situation is less
than desirable. Furthermore, some water discharge flows to the streets and canals
depending on the city.
4. There are few sources of housing finance other than households’ own funds.
While a large percentage of households do have accounts at banks, they have not
been able to use housing loans. It is speculated that on the one hand the full
amount of loan from the Housing Bank does not cover the price of a unit in the
more formal housing markets, whereas the houses purchased in the informal
market do not qualify for loans. The high interest rates in Iran due to high rates of
inflation exacerbate the situation.
5. A relatively large number of households own their homes, but a large number of
owners do not have full titles. This said, since there is little threat of eviction
made against those households who do not have titles, lack of full title only
affects the price of the dwelling unit. Other things that determine the price of
dwelling units are location and size. Furthermore, there is a positive relationship
between ownership and welfare as measured through consumption.
6. With significant source of funding, the local arms of the Ministry of Energy have
been able to provide water and electricity to the overwhelming majority of the
low-income neighborhood residents. However, several other urban services
31
including those related to the street conditions and garbage collection are
supposed to be offered by the municipalities which often lack adequate funds or
enough capacity to deliver these services in the low-income neighborhoods. The
dilapidated condition of the streets is also a security issue, especially for women
and girls.
7. The residents do make some investments in the homes but they pay little attention
to the appearance of their houses which has something to do with their public
rather than their private space. There is a relationship between ownership and
tendency to repair one’s home. However, the type of ownership document in the
hands of the owners is not important.
8. Housing prices, for rent or ownership, have been on the rise in the surveyed lowincome neighborhoods as everywhere in Iran. This means even these
neighborhoods have probably fallen outside the affordability range of poor
households currently without homes or those persons who just want to start a
family. It is then easy to speculate that these families will have to look toward the
more informal and irregular settlements on the fringes of the city to be able to
afford a home.
9. There is almost a complete absence of social, cultural, and sports centers across
the low-income neighborhoods of the three cities. Such centers can provide
various types of programs including skill training that can help transform the
socio-cultural atmosphere in the neighborhood and have a very positive social
impact on the next generation of the residents.
10. While residents of low-income neighborhoods exhibit high levels of traditional
social capital, they lack a modern type of social capital to participate in local level
initiatives. They are more or less estranged from the urban management and are in
reality not yet full citizens. In the absence of an empowering milieu, their social
capital will not be easily transformed.
In light of the above observations, some of the recommendations of this study may be
summarized as follows:
1. A range of urban services are missing in the low-income neighborhoods. This is at
least partly due to the scarcity of municipal funds. Therefore, a major issue in
upgrading is the improvement of municipal financial revenues and management.
2. There is a need to turn the residents into full citizens by improving voice and by
making sure the poor neighborhoods are represented, CBO/NGO activities are
enhanced, and the accountability of local officials improved. This means that any
future upgrading program will have to first start with an empowerment package
that will eventually create modern forms of social capital, participation, and
cooperation among low-income neighborhood residents.
32
5. There is a tight supply of land and housing. Part of this is due to the regulatory
framework while there are also issues of housing delivery mechanisms and
development that need to be addressed in order to both upgrade the current lowincome neighborhoods and prevent the formation of new slums.
6. Another issue is affordability of housing. Access to finance especially for the lowincome population who have limited budgets and often fluctuating incomes must
be enhanced.
7. There also seems to be a lack of initiative in the neighborhoods that can be
remedied through encouraging self-help groups, improving education (of rights of
individuals vis-à-vis municipal government, but also more generally of
opportunities for betterment).
8. Social conditions in the low-income neighborhoods bespeak of high levels of
cultural and social poverty. This needs to be addressed by expand social programs,
job training and small enterprise support in poor neighborhoods and by
strengthening or transforming traditional social networks as well as CBO
activities.
IV. REFERENCES
Athari, Kamal (2003) “Sanjeshe elale sakhtari va nahadiye hashyeneshini dar Iran
[Assessing the structural and institutional causes of fringe-neighborhood formation in
Iran]”, in Hashyeneshini va eskane qeyre rasmi [Fringe-neighborhood formation and
informal settlement], edited by Hoseyn Kakui, et al, Volume 1, Tehran: Daneshgahe
Olume Behzisti va Tavanbakhshi.
Central Bank of Iran (2005) Economic Trends, No. 37, Second Quarter 1383, Tehran:
Central Bank of Iran.
Nili, F., et. al. (1997) Barrasi-ye Tahavvolat-e Faqr, Towzi’-e Daramad va Refah-e
Ejtemai Teyy-e Salha-ye Gozashteh [An Examination of Developments in Poverty,
Income Distribution and Social Welfare in Previous years], Tehran: Institute for Research
in Planning and Development.
Rafii, Minu (2003) “Eqtesade Maskan [Housing Ecnomics]”, in Eqtesade Maskan, edited
volume published by National Organization for Land and Housing, Tehran.
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