Subsidies prop up Kabul's property market as troops prepare to withdraw

Behind Kabul's airport a new city is taking shape: a gated community where apartments are fetching top dollar under a government plan to subsidise purchases and infuse the emerging middle-class with confidence in the future of their war-torn country.

This is Aria City, where US$120,000 buys a two-bedroom, two-bathroom flat with balconies and double-glazing, and where, most importantly, residents feel far from the violence outside the gates.

Here, said resident Massoud Hossaini, "it is safe". In a city still at war amid escalating fears that the Taliban will win a role in government as President Hamid Karzai pursues peace, "people will spend a lot of money to buy in here because they are free".

On December 31, 2014, international combat troops will withdraw from Afghanistan after 13 years of war. Many foreigners and wealthy Afghans have left or plan to, further stemming the flow of cash that has propped up the economy and propelled Kabul property values to developed-world levels.

In the decade to 2012, around US$60 billion poured into Afghanistan, which ranks only above Somalia and North Korea on global corruption indices. With few other investment opportunities, Kabulis went on a property binge, building houses known as "poppy palaces" - mansions with bright tiles and Doric columns outside, and bowling alleys, cinemas, swimming pools, marble and chandeliers inside - and then renting them out for tens of thousands of US dollars a month.

Demand saw Kabul property prices hit parity with Paris, according to Ministry of Finance spokesman Najib Manalai, who lived in the French capital for 30 years before returning to Afghanistan in 2009.