RIYADH: The Saudi government’s recent announcements in the real estate sector, including providing more than 53,000 new homes in Riyadh and relaxing the ban on ownership by non-Saudis in Makkah and Madinah, will help to overhaul the sector and reach the Kingdom’s Vision 2030 home ownerships goals, according to an industry figure.
“The announcement of the allocation of 20 million square meters of land in the northern Riyadh suburb of Al-Jawan, effectively trebling the size of this neighborhood, to housing developments will certainly aid the government’s home ownership targets,” Faisal Durrani, head of Middle East research at real estate consultancy firm Knight Frank, told Arab News.
He added that the announcement by Crown Prince Mohammed bin Salman “follows the December announcement by Roshn to develop 30,000 residential units in Riyadh — 4,000 in the first phase — as part of a national program to deliver 1 million new homes by 2030.”
The move is also in line with the city’s aim to become one of the 10 largest economic cities in the world and to increase its population from 15 to 20 million by 2030.
The support for the housing sector will also help the government achieve one of its core Vision 2030 goals to reach 70 percent homeownership by the end of the decade, up from 47 percent four years ago and around 60 percent at present.
The decision late last week to allow companies listed on the Saudi Stock Exchange to own properties in Makkah and Madinah was also seen as a major move by the government to encourage foreign investment and to permit non-Saudi investor ownership in the prime markets.
“Opening ownership in Makkah and Madinah to international companies is a clear indication of the direction of travel of the Saudi economy and is perfectly aligned with Vision 2030,” Durrani said, adding: “The landmark change is likely to pave the way for a boost in demand for commercial real estate over the medium to long-term, as businesses are drawn to the emerging economic opportunities.”
Such moves by the government are likely to be a catalyst for a post-pandemic rebound in the Kingdom’s real estate sector, which are already up 25 percent year-on-year (Y-o-Y) in Riyadh during the first quarter of this year, and 34 percent Y-o-Y in Jeddah and 11 percent Y-o-Y in the Dammam Metropolitan Area.