Demand of Housing Units Exptected to increase by 50%
Tariq Changgez
'Saudi mortgage law eagerly awaited'
By K.S. RAMKUMAR |ARAB NEWS
Published: Jun 8, 2010 00:57 Updated: Jun 8, 2010 00:57
JEDDAH: The Saudi mortgage law, expected to be enacted by the end of the year, can increase demand for housing by around 50 percent, according to a real estate expert. "The enactment of the mortgage law is eagerly awaited, as it can help end users tackle their financing problems," Ahmed Ali Al Kulli, general manager of Emaar Middle East, told Arab News on the sidelines of the three-day Cityscape Jeddah 2010, which opened with the support of Jeddah Gov. Prince Mishaal bin Majed on Monday. Marking the event is a real estate exhibition in which more than 100 local and regional property investors, developers and service providers are showcasing their current and future projects, and services, at the Jeddah Centre for Forums and Events.
Kulli said the Kingdom was one of the countries not affected by the world financial crisis and with its strong and buoyant economy held excellent prospects for the booming real estate sector. "There was a slowdown (in real estate) in parts of the region, but we are least impacted by the financial crisis and are waiting for the mortgage system to come. Once the mortgage system is introduced, it can increase the demand by 200,000 (housing) units per year," as 60 percent of the Kingdom's population is of youth." The Kingdom needs to spend about $180 billion by 2015 to build new homes, according to the National Commercial Bank.
Analysts expect that the virgin market appeal of the Saudi mortgage sector will draw interest from lenders throughout the Gulf. While trillions of dollars worth of projects have either been shelved or scaled down in other GCC states, the Kingdom's construction and property sector has come through the financial crisis in better shape than most of its neighbors. There is a shortage of two million homes in the Kingdom and it needs another 1.5 million housing units over the next 10 years.
Emaar Middle East, a subsidiary of global property developer Emaar Properties PJSC, is leveraging its participation in Cityscape Jeddah to highlight the on-schedule progress and commitment to project delivery. It is showcasing its three flagship projects in the Kingdom - Jeddah Gate, Alkhobar Lakes and Emaar Residences at Fairmont Makkah at the event, Kulli said. Emaar is also showcasing its other international projects including residential master-planned communities in Turkey, Pakistan and Egypt, among others.
"We have made significant progress on all our projects with the first residences in Jeddah Gate and Alkhobar Lakes scheduled for hand over shortly," he said, adding that Jeddah Gate is a SR6 billion mixed-use project featuring residential and commercial units, and a leasable area for retailers. The $4.5 billion Alkhobar Lakes is a luxury lakefront development in Eastern Province, which features more than 2,000 private villas with retail and leisure amenities for family living. The Emaar Residences at the Fairmont Makkah is located directly on the Haram Plaza. The serviced residences are offered on a leasehold basis. "The projects will set a new milestone in the real estate dynamics of the Kingdom," Kulli said.
This year's event also features the annual Saudi Arabia Real Estate Investment and Development Conference, with "Transparency, investment models and future partnerships" as its theme. More than 40 CEO-level speakers are addressing key industry issues and trends at 12 panel sessions during the event, which also has the support of the Ministry of Commerce and Industry and the Jeddah Chamber of Commerce and industry.
The event complements a 20-year local redevelopment program covering the central and historic districts of Jeddah, the Kingdom's second largest city and the 'Gateway' to the holiest Islamic sites. This year's event is also larger than the inaugural one in 2009 in which 80 exhibitors from 40 countries took part and received more nearly 9,000 international and regional visitors, Deep Marwaha, director of Cityscape Saudi Arabia, described as the largest portfolio of real estate events worldwide.
The day's panel discussions were focused on the "Global Economy and Saudi Arabia: Lessons Learned from the Crisis," and the evaluation of the impact of the mortgage law in driving new opportunities in the residential market. There was also a keynote address on facilitating the Kingdom's hospitality and tourism infrastructure development on behalf of the Saudi commission for Tourism and Antiquities.
Tariq Changgez
IT Manager
Omrania & Associates
Tel: 966-1-4622888 Ext. 122
ta...@omrania.com.sa
www.omrania.com.sa