saudi update focus
Significant deregulation and an increasingly open and attractive business climate for
potential foreign investors has meant that while other regional and international financial markets continue to suffer in the aftermath of the global downturn, industry experts are still confident of Saudi Arabia’s ability to weather the storm better than other countries due to its economic surplus. Enactment of the new mortgage law has the potential to increase housing demand
by as much as 50 percent, according to regional reports, as mortgage lending currently accounts for only two percent of the Kingdom’s GDP. Industry analysts and local developers are also touting this historic move as the trigger
for the country’s second housing boom. “The Kingdom needs to enhance the way it finances housing purchases and how it uses financial instruments for such transactions if it wants to sustain its leadership in the regional property business. The mortgage law is an important step in broadening opportunities for buyers, investors and developers and establishing the country as a top real estate hub,” says Ayedh Al-Qahtani, chairman, Sumou Real Estate.
The Emaar Residences at the Fairmont Makkah, focus on visitors to the holy city. Positioned directly on the Haram Plaza, the homes are located in the tallest tower within Abraj Al-Bait, and residents have the fulfilling experience of even viewing the Holy Kaaba from their homes
RESIDENTIAL MOVEMENT
According to Jones Lang LaSalle’s latest MarketView report there was a moderate drop in residential sales during 2009 versus 2008, with a 10 to 20 percent decline in the three main centres of Riyadh, Jeddah and the Eastern Province (Al Khobar/Dammam). The surge in development in the Eastern Province that has accompanied the booming oil sector in recent years has not yet overtaken demand for residential space and occupancy in all sectors - especially compounds - remains extremely high. And local developers are emerging onto the market with increasing frequency. Jiwar
Real Estate Management & Marketing, part of the Saudi Bin Laden Group, has already announced plans to set up a development division focusing on the residential sector, with paid-up capital of SAR250 million (US$66.6 million). The company, which is involved in Makkah’s Abraj Al-Bait project, under development
by the Saudi Bin Laden Group, is looking at Riyadh, Jeddah, Makkah, Madinah, Dammam and Al Khobar as the top residential markets in Saudi Arabia, with rented housing units accounting for 83 percent of total market share.
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/jun-sep 2010
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