RIYADH, 22 May 2007 — Crown Prince Sultan, the regent, said that the trust of the local and international investor in the stability of Saudi Arabia and the seriousness of its leadership in implementing reforms were two factors which could attract multimillion investments in the country.
“Security is the key to economic growth and prosperity in all life affairs,” he said in a speech read out by Minister of Commerce and Industry Hashim Yamani during the inauguration of the Saudi International Real Estate Conference (SIREC) on Sunday evening. Nearly 1,500 specialists in the real estate sector are participating in the international symposium.
Crown Prince Sultan also said the establishment of six economic cities in various regions of the Kingdom was a “living example” of the government’s support to the real estate sector.
He said that the establishment of the Housing Commission would be effective soon.
Sultan called for better cooperation between the governmental and private sector “to achieve development plans and provide a suitable house for every family”. He urged that participants to reach conclusions which are based on research and scientific studies in the areas engineering and modern construction.
Minister of Economy and Planning Khaled Al-Gosaibi said future government plans are aimed at increasing the percentage of Saudis owning their own houses to 75 percent in 2025.
“The increase in ownership of homes will remain an important strategy for the government which aims at improving the living conditions for citizens,” he said.
Al-Gosaibi urged for the finding of new channels for house funding. The purpose of that is to speed up the framework of development, he added. He said the real estate sector in the Kingdom was going through a transitional phase.
“It represents 13.4 percent of the total GDP and 31 percent of the non-petrochemical contributions from the private sector,” he said, adding that the real estate boom first started in 2002 and continues till today.
Al-Gosaibi said the annual population growth of 3.5 percent during the eighth development plan in Saudi Arabia was another factor that contributed to the rapid development of the real estate sector here.
“That will increase the demand for housing units by an estimated 730,000 during the eighth development plan,” he said.
President of the Saudi Chambers for Commerce and Industry Abdul Rahman Al-Rashed pointed out that the real estate sector volume in the Kingdom ranged between SR800 billion and SR1,200 billion, adding that SR200 billion was being circulated in the market every year.
He mentioned that several aspects had contributed to the real estate growth in the Kingdom.
The first is the economic boom in the Kingdom.
“We expect the boom to continue for another 20 to 25 years,” he said. The second is the local and foreign investors’ trust in investing in Saudi Arabia. The third factor he mentioned was the increase of oil prices. The fourth is the large demand on housing units.
The government, he said, has been supportive to the real estate sector.
The official mentioned however that despite the boom, the real estate sector in the Kingdom still lacked the legislations and much are needed to be done to eradicate obstacles.
“That can only be achieved if the public and private sectors cooperate with one another,” he said.
