Apartment rents likely to drop, says survey



JEDDAH: ARAB NEWS

Published — Sunday 2 December 2012

Last update 2 December 2012 5:31 pm

| نسخة PDF Print News | A A

Apartment rents are likely to fall in the near future and tenants will be able to lease larger houses, according to a recent study. 
“It is expected that the Saudization policies of the government and the soft housing facilities offered by the Ministry of Housing will reduce the demand for rented houses and enable Saudis and expatriates to live in more spacious houses,” a statistical study by the National Strategy for Housing, reported.
Charity organizations estimate that more than 70,000 Saudi families do not own the houses they currently occupy, while the Ministry of Social Affairs considers that figure far below the actual demand.
The ministry’s assumption is based on the fact that it provided assistance to 470,000 economically disadvantaged families in 2009, and the number of those seeking assistance has grown significantly since then.  
“Unofficial figures regarding the number of Saudis receiving assistance from the minisries of Social Welfare and Labor have crossed the 3 million mark,” the study said. 
“The rental market for houses is rather solid and the rate of occupancy is comparatively high. The recent increase in unoccupied apartments can be attributed to the sharp fall in demand from non-Saudi tenants, due to the recent Saudization policies. Non-Saudi tenants are facing a kind of employment recession, which affects the demand for rented apartments.”
Another factor in this recent development is the low-cost housing facilities offered by the Ministry of Housing. This will no doubt affect the demand for rented apartments, since a significant number of Saudi families are likely to shift from rented properties to their own houses,” the study observed.
Saudis who do not own their own houses have several options to acquire a house. They can build houses on the plot they own or buy a house by getting a bank loan. Only a small percentage of Saudis cannot afford to own a house and that is attributed to one of two reasons: Either they do not have an income and savings, or because they are ineligible to benefit from credit facilities, the Al-Hayat daily reported yesterday.  
The study also indicated that the lack of demand in the rental market for houses is not above 5 percent in the Kingdom, although the percentage may vary from place to place, or from one season to season.  In March last year, the Ministry of Housing was established under the leadership of Shwaish Al-Duwaihi to resolve the massive housing problem in the country, aggravated by the rising population and increase in the demand for housing fueled by expatriates.
The ministry’s short-term projects to face the challenge included building 500,000 housing units at a cost of SR 250 billion in different parts of the Kingdom.
A report by Banque Saudi Fransi last year said private and public developers need to build about 275,000 units a year through 2015 to meet the country’s demands for about 1.65 million new homes.

What's happening around Saudi Arabia

JEDDAH: The father of the suicide bomber who blew himself up in a mosque in Kuwait has blamed “evil” forces for his son’s behavior.Sounding confused and sad, Sulaiman Al-Gabbaa, the father of Fahad Al-Gabbaa, said: “An evil hand has sent my son to hi...
JEDDAH: The Saudi Traffic Department has denied that it is introducing new license plates for cars.It said hackers posted pictures of the supposedly new license plates on its Twitter account on Sunday. The department said the news, which went viral,...
JEDDAH: The Al-Haramain Train project is described as the largest public transportation project in the Middle East. This vital and strategic project is one of the implementation schemes of the mass expansion of the Saudi railway across the country.Th...
JEDDAH: The number of marriages between expatriates and Saudis has dropped 84 percent to 1,928 since the start of this Islamic year that began on Oct. 24, compared to the same period the previous year.The Ministry of Justice said that there were 12,0...
JEDDAH: The General Authority for Civil Aviation (GACA) launched the idea of a project called Watani to link all parts of the Kingdom by air by beefing up activities at important provincial airports.Capt. Abdul Hakim Badar, assistant vice president a...
JEDDAH: Unofficial marriage is a refuge for a divorced mother to lead a married life while keeping her children in her custody but without the knowledge of the former husband who could demand the custody of the children if he learned about the ex-wif...
JEDDAH: Makkah’s health department has set up a committee to verify the sick leave certificates of employees.The department stated it would apply government regulations on sick leave, which includes people providing the address of the facilities wher...
RIYADH: The directorate of roads and transport has registered 20 cases of violations worth SR24,500 in Al-Qassim, where the transport ministry continued its surveillance drive against the companies in the transport business.According to the directora...
RIYADH: The implementation of an integrated health plan to combat MERS has resulted in a sharp drop in cases, with only one out of 736 samples testing positive for the contagion in the Kingdom in the last six days. Health Ministry spokesman Dr. Khal...
RIYADH: Muslims must cut traditionally high electricity use during Ramadan in line with the principles of austerity and self-control they are supposed to adopt in this month, economists say.Economist Al-Sadeq Idris said energy use increases during Ra...
JEDDAH: The Ministry of Commerce and Industry will begin next Tuesday to check whether companies are complying with new laws requiring them to place proper price labels on all their products.It is mandatory for companies to stop using phrases such as...
RIYADH: Minister of Islamic Affairs Saleh Al-Asheikh chaired the first meeting with Yemeni scholars to exchange ideas on how to strengthen their role in restoring peace in their country.The first Saudi-Yemen scholars meeting, dubbed the “outreach sch...
RIYADH: To cope with the growing number of applicants (boys and girls) at technical colleges that reached 126,023 last year, a state-run organization launched an online unified portal to ease the enrolment procedures.According to the Technical and V...
RIYADH: A senior government official from Dhaka, who visited Riyadh last week, has sorted out technical issues to expedite issuing 1.5 million machine readable passports (MRP) to Bangladeshi expatriates in the Kingdom. Information and Communication T...
JEDDAH: Jeddah municipality is keen to provide health and food security to residents and visitors of the city, and they are continually conducting inspections of food stores, restaurants, markets and food storage facilities to avoid any violations by...

Stay Connected

Facebook