JEDDAH: Residential sales volumes in Saudi Arabia have recovered to pre-coronavirus (COVID-19) levels, reaching their highest level for five years, according to a new industry report.
Rising mortgage rates have also helped the government reach its homeownership targets as part of Vision 2030.
Faisal Durrani, head of Middle East Research at Knight Frank, said in a statement: “With homeownership at 60 percent at present, the government has already surpassed its 2020 target by 8 percent and is well on course for achieving 70 percent homeownership by 2030.”
“At 115,000 transactions, sales volumes between January and May are on par with the same period in 2019 and are 49 percent higher than January to May 2018. Homebuyers and lenders are clearly feeling more confident as the post-COVID recovery starts to bed in,” Durrani added.
A total of 38,285 mortgages were issued for the purchase of villas and townhouses in the first quarter of 2021, worth a total of SR48 billion ($12.8 billion).
The Sakani initiative was launched in 2017 to boost home ownership through a landmark housing allocation program, which benefitted 1.1 million families. The Wafi program monitors and manages off-plan sales.
The Kingdom also aims to add more than 500,000 units to Riyadh’s housing stock by the year 2030, Durrani said: “That is just 100,000 units less than Dubai’s total current housing stock, (and) means Saudi nationals are able to get on the housing ladder in record numbers.”
Last week, the Saudi Real Estate Refinance Co. (SRC), the mortgage finance giant owned by the Kingdom’s sovereign wealth fund, the Public Investment Fund (PIF), announced it had bought a “significant portion” of the housing finance portfolio owned by Arab National Bank (ANB).
According to an SRC statement, the agreement will “provide liquidity to ANB, which in turn provides greater homeownership opportunities for more than 2 million of the bank’s customers.”