Saudi Arabia cracks down on off-plan sales violations

Saudi Arabia’s housing ministry has clamped down on 61 projects that failed to observe off-plan sales regulations. (Screenshot: AN.pk/YouTube/Majid Enani)
Saudi Arabia’s housing ministry has clamped down on 61 projects that failed to observe off-plan sales regulations. (Screenshot: AN.pk/YouTube/Majid Enani)
Updated 07 January 2021

Saudi Arabia cracks down on off-plan sales violations

Saudi Arabia’s housing ministry has clamped down on 61 projects that failed to observe off-plan sales regulations. (Screenshot: AN.pk/YouTube/Majid Enani)
  • The violations were detected during inspection tours by control teams

RIYADH: Saudi Arabia has clamped down on 61 projects that failed to observe off-plan sales regulations, the Ministry of Housing revealed.

The violations were detected during inspection tours by control teams responsible for the Wafi off-plan sales and rent program.

The tours, which covered a number of cities throughout the Kingdom, were conducted as part of the program’s efforts to regulate the off-plan real estate sector in the country.

Head of the off-plan sales and rent committee, Abdul Aziz bin Mohammed Al-Muhaymid, noted the importance of obtaining a license to sell or market off-plan units and urged real estate establishments to abide by the licensing controls and regulations.

“Some of the violations that were detected concerned the selling and reserving of units, signing contracts with buyers, and receiving advance payments for financial projects under construction,” he said.

Al-Muhaymid pointed out that Wafi teams would continue to carry out inspections throughout Saudi Arabia and any violators would be referred to the Public Prosecution with a view to facing possible legal action.

Arab News recently reported that off-plan property sales represented a growing sector of the Saudi real estate market, but that some consumers were still wary of developers’ abilities to deliver quality homes on time.

According to real estate consultancy company, Knight Frank, off-plan units represent around 9 percent of the total existing housing stock, but a massive 60 percent of total future supply in the Kingdom.

The firm questioned 1,000 Saudi nationals for its national housing survey of the country for 2020. Asked how likely they were to buy an off-plan property, 26 percent said very, 37 percent fairly, 14 percent not very, and 13 percent said not at all.

“As the residential market sees more institutional developers enter the market and with regulations being enacted to protect buyers, such as the Wafi program, there will be greater levels of confidence in buying off-plan going forward,” Taimur Khan, an associate partner at Knight Frank, told Arab News.

Of those who said they were unlikely to buy an off-plan property, 45 percent indicated that the reason was due to a lack of trust in developers over quality, while 19 percent said they were not confident that the unit would be delivered on time.

With the government aiming to increase homeownership in the Kingdom to 70 percent by 2030, from 50 percent in 2018, off-plan may soon become more commonplace. But those looking to take advantage of the sector have been warned to get their paperwork in place first.


UAE’s Mubadala Petroleum signs Red Sea oil exploration deal with Egypt

The agreement, signed by Egyptian Minister of Petroleum and Mineral Resources Tarek El-Molla, allows the company to explore in a 3,084 square kilometer area of the Red Sea. (Shutterstock/File Photo)
The agreement, signed by Egyptian Minister of Petroleum and Mineral Resources Tarek El-Molla, allows the company to explore in a 3,084 square kilometer area of the Red Sea. (Shutterstock/File Photo)
Updated 23 January 2021

UAE’s Mubadala Petroleum signs Red Sea oil exploration deal with Egypt

The agreement, signed by Egyptian Minister of Petroleum and Mineral Resources Tarek El-Molla, allows the company to explore in a 3,084 square kilometer area of the Red Sea. (Shutterstock/File Photo)
  • It will own 27 percent of the stake as part of the agreement, while Shell will own 63 percent

CAIRO: The UAE’s Mubadala Petroleum Company has signed an agreement with Egypt to explore for oil and gas in the Red Sea.

The agreement, signed by Egyptian Minister of Petroleum and Mineral Resources Tarek El-Molla, allows the company to explore in a 3,084 square kilometer area of the Red Sea and was a result of a bidding round in 2019.

It will own 27 percent of the stake as part of the agreement, while Shell will own 63 percent. Egypt’s Tharwa Petroleum Company owns the remaining 10 percent.

The agreement refers to an area known as Sector 4, located in the north of the Red Sea in an area adjacent to the Gulf of Suez Basin, which is rich in natural resources. 

Parties will commit to conducting exploration studies in this sector and collecting seismic data for the area, using three-dimensional techniques, during the first three years of the exploration phase.

“The addition of Sector 4 in the Red Sea represents a new extension of our operations in Egypt, while providing a valuable opportunity to expand our activities, and by working with a strategic partner such as Shell,” said Mubadala Petroleum CEO Bakheet Al Katheeri. “The search and exploration operations in this sector, if successful, will support our strategy of extracting and manufacturing hydrocarbons, in order to contribute to supporting the stability and expansion of the Egyptian market, while providing growth opportunities for our operations in the country.”

Mubadala Petroleum owns a 10 percent stake in the offshore Shurooq gas field concession that includes the Zohr natural gas field, in addition to 20 percent in the concession area of Noor Gas Company. Both are located in the Mediterranean Sea off the coast of Egypt.