20/03/2011
Kingdom housing demand to grow over 18% in 3 years
Saudi Arabia’s housing demand is anticipated to grow at a CAGR of over 18 percent during 2010-2013, RNCOS said in its latest "Saudi Arabia Housing Sector Outlook" report Friday.
The study said Saudi Arabia has the largest real estate market in the GCC, with more commercial (office, retail, and residential) floor space than all the other GCC countries combined.
However, the Kingdom has a shortage of owner-occupied residential housing, particularly at the lower end of the income scale. Saudi Arabia’s residential sales prices are currently considerably below than other GCC markets.
It further said recovery of oil prices, continuous government stimulus, and gradual relaxation of bank lending are some of the important factors fueling growth in the Kingdom’s residential real-estate market.
Moreover, the introduction of a new mortgage law will transform the market, enabling increase in supply, quality of construction, and transparency, aside from various other strong fundamental drivers.
Due to the growing needs of a large young population in the Kingdom, the housing market in Saudi Arabia has shifted its focus from palaces and luxury villas to the needs of a changing society, the report noted.
"The market is witnessing greater demand for affordable housing compare to traditional villas. The rapidly growing population and increasing number of married couples in search of affordable entry-level housing will fuel the demand for affordable housing in the Kingdom," RNCOS said in the report.
