Riyadh—Amlak
As part of its new overall strategy, the Ministry of Housing is preparing to submit the strategy to higher authorities for approval, after the ministry has completed the necessary studies, which include imposing fees on unused vacant land.
This was clarified in a press statement by Mohammed Al-Abdani, Director General of the Real Estate Development Fund
, explaining that the new overall strategy includes recommendations such as expanding the provision of land to borrowers from state funds, requiring owners of unused land to pay zakat, and imposing fees on unused land, as well as adopting measures to curb speculation and high-volume real estate transactions. He noted that «the strategy’s content was developed in collaboration with several local and international entities, following numerous workshops and coordination meetings among these parties.»Al-Abdani downplayed criticism directed at the agreement the Fund signed with a number of Saudi banks, such as the banks» requirement that salaries be deposited with them, especially since the majority of those targeted by the recent financing solutions already have existing loans with banks, which reduces their chances of benefiting from these lending programs. He noted that the additional financing had been carefully studied, and the Fund found it to be a valuable aid for citizens who cannot afford to purchase homes worth the loan amount or who do not own land on which to build homes using the Fund’s loan. For this reason, the Fund has finalized a financing agreement with the banks, which, of course, are keen to recover their loans in accordance with the regulatory relationship they have with the citizen,« noting that »the Fund cannot intervene in this matter, nor can the Fund act as a guarantor for an optional financing loan between a citizen and a bank, as the financing loan is not mandatory but rather optional for those who wish to take it out, believe they have the ability to repay it, and agree to the terms of the financing bank.«
Al-Abdani emphasized that »the loan is not sold to those who have obtained mortgage loans, and the Fund does not approve of this at all; what is permitted for sale is the property that was constructed with a loan from the Fund, and it is sold in accordance with specific terms and conditions that cannot be circumvented.» Regarding the standardization of the mechanism for disbursing loans and payments, he noted that the disbursement of payments has been standardized so that all types of loan payments are disbursed within just three months from the date the contract is signed, provided that this is linked to the percentage of completion of the buildings under construction, The Fund has also standardized the start of the repayment period at twenty-four months from the date the contract is signed.» Al-Abdani attributed the delay in announcing the beneficiaries to the high volume of applicants to the Fund, whose number now exceeds 2.3 million,« adding that »those who are approved will be loaned funds according to a scheduled payment plan.« He said: “The Fund’s achievements over the past two fiscal years underscore the scale of the loans it has approved.