A recent study conducted by the High Commission for the Development of the Riyadh Region revealed that the total land area of the capital, Riyadh, exceeds 5,000 square kilometers, while the area occupied by unused white land accounts for less than 77% of the total area. The study indicates that the area of this white land amounts to 4,146 km² or four billion m². The study notes that a city the size of Riyadh—4,900 square kilometers—is home to only five million people.
Anticipating the Housing Minister’s Policies
While the real estate sector and citizens eligible for housing support await the new policies to be implemented by His Excellency the Minister of Housing, Mr. Majid bin Abdullah Al-Hogail, the Kingdom’s market is experiencing caution in most real estate sectors, particularly the residential sector—including apartments for sale, duplex villas, and land. Observers believe the coming phase is expected to see activity within the Ministry aimed at developing a ”Housing Strategy” to help devise radical solutions to the housing problem, particularly regarding the utilization of vacant land within cities.
The Need to Utilize Vacant Land
In the same vein, a number of real estate developers have called for the utilization of vacant land within cities, which in some cases accounts for up to 30 percent, as such vacant spaces within cities are considered the real fuel and through them, the housing problems plaguing most major cities can be resolved. Developers are in the process of changing perceptions and patterns of demand for all types of real estate—whether for residential units or small plots of land—by subdividing large tracts of land and creating housing units of various sizes that meet the requirements of financing institutions. This trend has boosted demand for small residential plots with sizes suitable for building small, affordable homes.
Grant Lands
Grant lands appear to play a significant role in addressing the housing crisis, as they contribute to solving the problem by being used for the purpose for which they were granted—not for sale—and will partially help resolve the housing issue. It can be said that if grant lands are clearly provided with services and infrastructure in their master plans, they will solve half the problem for citizens and provide them with the stability they need.
Furthermore, the provision of grants helps significantly reduce land prices, thereby alleviating the housing crisis and rising rents. Therefore, the Ministry of Municipal and Rural Affairs has directed its attention to everything that would develop a comprehensive approach and care in managing land affairs—whether in preserving them, addressing related issues, investing municipal resources and properties, or providing land grants designated for citizens" housing It is also committed to achieving integration and consistency in performance and the execution of duties within the Ministry and its affiliated agencies, in accordance with standardized and unified procedures that align with a defined policy and a sound strategic plan.
Optimism Regarding Real Estate Market Activity
For his part, Abdulrahman bin Adnan Al-Muheidib, CEO of Wathra Real Estate Investment and Development Company, said: The real estate market will witness, in the coming period, a qualitative shift driven by the market’s liberation from the uncertainty that has prevailed over the past two years, For example, in Jeddah, there are at least three to six real estate investment projects that will be put up for sale before the end of this year, all of which focus on residential investment land products.
Al-Muheidib emphasized the necessity of strategic action by the Ministry, especially since the new minister recognizes—based on his experience in the private sector —the importance of strategic action, particularly in a critical sector such as housing. He emphasized that imposing fees on undeveloped land is one of the key decisions we believe will shift the market from speculation that benefits individuals to development that delivers products to consumers.
