On a directive from Custodian of the Two Holy Mosques King Abdullah, the Ministry of Housing has written off SR198 million in loans given to 852 citizens who have died.

Housing Minister Shuwaish Al-Duwaihi, who is also the head of the Real Estate Development Fund (REDF), has carried out the order.

REDF Director General Yusuf Al-Zohaibi said the families of those who died had applied online for the concession.

Meanwhile, the REDF last week announced the disbursement of SR2.5 billion in loans to build 6,204 new housing units throughout the Kingdom. Al-Zohaibi said the selected applicants would be given 12 months to modify the specifications of their housing units to suit the terms of the loan agreement.

According to a recent study, the Kingdom needs 4.5 million houses over the next 15 years, at 300,000 every year. In Riyadh, the lack of affordable homes is especially acute with a shortage of 225,000 units.

According to Housing Ministry spokesman Muhammad Al-Zumai, the loan schemes provide for land and construction of homes. The government is also building 500,000 low-cost housing units at a cost of SR250 billion. This is aimed at reducing property prices and rents.

The government has specified people who can apply for loan.

They are a husband and wife with or without children, a single father, a single Saudi mother who is widowed or divorced, or a non-Saudi mother with children from a Saudi father. Applicants must be over 25 years of age, and have no other family members already owning a home or having owned one in the five years preceding the application. The mother of children may apply if there is no father.

The REDF started its activities at the beginning of 1975 to provide loans to citizens to help them construct their own homes and for investment purposes. It commenced operations with a capital of SR250 million.

Over the first 25 years, the REDF has granted 443,842 private loans and 2,488 investment loans worth SR120 billion, resulting in the construction of 555,866 residential units in 3,976 cities and villages.