Data released by the Saudi Central Bank (SAMA) revealed growth in the number of new residential mortgage contracts for individuals at the start of this year, with 32,800 contracts signed in January, worth over 16.4 billion riyals, compared to 24,300 contracts in the same month of 2020, which totaled 10.3 billion riyals provided by all mortgage lenders, including banks and finance companies.
Residential Financing Continues to Rise
SAMA noted that housing finance for last January rose by 4 percent compared to the previous month, December, when financing reached 15.8 billion riyals, while the number of contracts rose by 8 percent for the same month, during which 30,500 contracts were signed.
SAMA noted that housing finance contracts provided by banks accounted for more than 98 percent of the total number of contracts concluded through other real estate financiers, such as financing companies and institutions, amounting to approximately 32,300 contracts worth 16 billion riyals, representing 97 percent of total financing in January, with about 2 percent provided by finance companies.
1,790 TP3T in financing for residential villas
In January, residential villas accounted for the largest share of financing at 12.9 billion riyals, or nearly 79 percent of total financing, while residential apartments ranked second with more than 15 percent, totaling 2.5 billion riyals. Financing for the purchase of residential land ranked third at 6 percent, totaling 989 million riyals.
Official statistics from the Central Bank showed that last year, 2020, saw record growth in the number of contracts, exceeding the total for the previous four years combined by approximately 295,5 thousand contracts worth 140.7 billion riyals. In 2019, real estate financing also reached historic levels, exceeding 3.5 times the volume of 2018 with approximately 179.2 contracts worth 79.1 billion riyals.
According to Samba data, mortgage loans at the end of 2018 totaled approximately 50,500 contracts worth 29.5 billion riyals, and in 2017, there were approximately 30,800 contracts worth 21 billion riyals, while 2016 saw the signing of 22,200 mortgage contracts worth 17 billion riyals.
According to the statistical bulletin, growth in residential mortgage financing for individuals last month 60 percent, exceeding 16.4 billion riyals ($4.3 billion) compared to the same month last year. It noted that the number of new residential contracts grew by 35 percent compared to January 2020, which recorded 10.3 billion riyals.
