Real estate developers, economic analysts and specialists in real estate finance emphasized that the decision of the Monetary Authority to oblige financing bodies to require a percentage of 30% as a down payment to obtain housing finance will be a new obstacle for those with limited income in front of the request for loans, and they expect that this percentage as a down payment of the value of the property will not be effective, while they pointed out that the decision will limit the rise in prices for raw lands but will contribute to another effect, which is the rise in rents.

Real estate developers, economic analysts and specialists in real estate finance Mr. Mohammed Al Muhaimid, CEO of Amlak Al Shifa Real Estate Company in Riyadh, explained that the forces of supply and demand are the main axis in a free market to look for the best ways to facilitate the citizen and not specify a percentage of the value of the payment for real estate financing, as many as we see in the market cannot afford 30% of the value of the property, especially with these highs caused by land speculators supposed to be comfortable and open payment according to individual income.

Al Muhaimid adds : Despite the keenness of the Monetary Agency on the citizen so that he does not get involved in obligations that hinder him from the luxury of living, the application of this percentage will in turn hinder and prevent a large segment of citizens from obtaining housing. But awareness is required about the culture of savings from several government agencies in cooperation with the financing agencies and not put obstacles to obtain appropriate financing.

Mr. Abdulrahim Al-Tuwaijri, CEO of Mizat Real Estate Company - a real estate developer - said that there are several segments in society, including those who can afford this percentage and this segment will not be affected, which is the middle and higher, but the great segment that really needs to overcome any obstacles with the creation of financing programs to help them obtain housing and save, no doubt that they will be affected and worsen their crisis.

<The head of finance products at a Saudi bank said that the implementation of the decision of the Monetary Authority will make there is a reluctance to request financing by those wishing to finance, because the largest percentage of them are unable to provide 30% of the value of the property, but Al-Dahmash reiterated that the decision to apply 30% of the value of the property has many positives, namely The decision to apply the 30% percentage to the value of the property has many positives, such as lowering the price of the property and not requiring the citizen to obtain financing at the highest credit ceiling, resulting in lower profits and a reasonable repayment period, due to the lack of demand for the real estate product, as competition will flare up between banks and financing companies in reducing interest rates and offering many advantages such as deferred installments and others.
Al-Dahmash pointed to a legal loophole that could be exploited by the financing entities, explaining that the decision did not stipulate that the 30% is a down payment of the value of the property, and this will make the entities give the customer cash financing to meet the requirement of the Monetary Agency, or divide the tolerance ratio by the duration of the contract, thus making the decision somewhat ineffective.

He explained that the spread of the news in the past period and the anticipation of the activation of the decision greatly affected the prices of villas and diplomas, where the decline reached 30% in the Eastern Province, 20% in Riyadh and 15% in Jeddah, while land prices were not significantly affected.
As for its reflection on the real estate market in general, he said: All government sectors must join hands that will effectively affect the real estate market, as the decision of the Foundation, no matter how positive, will not be able to significantly affect the solution to the housing crisis or the decline in the price of real estate, so all previous decisions of the Real Estate Development Fund must be activated and impose fees on white lands, thus ensuring that the citizen owns the property at a reasonable price.
Abdulwahid Al-Omari, branch manager of a Saudi bank, emphasizes: The application of the 30% advance payment decision by the Monetary Authority will not contribute to alleviating the housing crisis and will not serve all groups in society, because it is difficult to provide the payment, as the price of the property of one million riyals requires the borrower to provide an amount of (300. 000) riyals.This will increase the suffering of some citizens when wanting to benefit from mortgage financing from licensed entities, and low-income people will not benefit from the decision and will incur other debts from different parties to provide the required payment from the financing entities if he wants to own a home, stressing at the same time that the decision contributes, God willing, to the decline in real estate and land prices.
Economist Dr. Abdullah Al-Maghlouth said: The decision to set the 30% percentage of the mortgage loan supports those wishing to build housing units who seek liquidity to enable them to complete the construction of their units, and this also contributes to the availability of housing and seek in the future to reduce the scarcity of housing units, and therefore when citizens obtain these loans, they will strive to spread in construction and find amounts that enable them to build many units, which makes there is a decline in demand and abundant supply, and prices through these measures will be reasonable and balanced, and it will contribute to reducing rents 20%.

He added: What hinders the citizen currently is the lack of liquidity in his hands to enable him to complete construction, but when there is liquidity under loan facilities will accelerate the construction of these units.

He pointed out that when there is more supply and less demand, and there is competition in the value of rents and sales from real estate and owners of residential units, and therefore there will be a decrease in prices, in addition to the Real Estate Fund still provides loans to citizens in billions, and there is a trend from the Fund to pump new numbers, in addition to the Ministry of Housing is striving to provide housing units, as it has already signed contracts with contractors to deliver these units in the future, in addition to developing plans from infrastructure, and then handing over land to citizens through the (land and loan) program. All these factors are helping the real estate market to decline, especially the residential units sector, in addition to the decline in rental prices.