In light of the new Ministry of Housing’s initiatives and policies to address the housing crisis, experts have affirmed that the ministry’s recent strategy will revitalize the real estate sector, as well as the construction, maintenance, and building materials sectors, by involving the private sector in the responsibility, drawing on its past experiences that created a wide gap between the ministry and its goals due to its reliance on its own resources to fulfill its promise of building 500,000 housing units with a budget of 250,000 riyals.
Getting companies" affairs in order
Real estate development companies in the Kingdom are working to get their internal affairs in order so that they can meet the responsibilities awaiting them in the coming period, and to harness their expertise and financial and human resources to develop housing projects under the Ministry and the Real Estate Fund, in accordance with the technical and time-related mechanisms and conditions previously set by the Ministry of Housing for real estate development companies. This is particularly important given that the number of those eligible for housing support has reached 1.3 million.
The Kingdom’s market is home to dozens of real estate development companies with varying capabilities and investment levels; some have a long and extensive history in real estate, and others have successfully completed many large-scale projects in the Saudi and Gulf real estate sectors.
Striving for a Successful Outcome
These companies are striving to prove themselves worthy of the trust placed in them by the Ministry of Housing, which has revised its plans to fully open the door to local and foreign real estate development companies to implement the Ministry’s housing projects, which means a spirit of fair competition will ignite between national companies on one hand, and incoming companies on the other. This means a great deal for the local market, as it will pull it out of stagnation, creating significant momentum in market sectors related to construction and building, not to mention the expertise the sector will gain if highly experienced foreign companies enter the market.
Expected Economic Momentum
Observers and real estate experts confirm the validity of our argument regarding the importance of opening the sector to real estate development companies to contribute to the construction of housing projects, which will have a positive impact not only on real estate development companies but also on all sectors supporting the construction process, such as contracting firms—which developers rely on to bring their housing projects to life— as well as key sectors such as retail, furniture, paints, and interior design, in addition to the service sector that will provide services to new residential neighborhoods, which means opening new markets, opportunities, and hundreds of job opportunities for young people.
The result: price stability
When the Ministry passes the ball to the developers, this will inevitably lead to stable and reasonable prices, which had been rising due to real estate development companies in the Kingdom, and a great deal of monopolized and hoarded land will be released, especially after the implementation of the decision to impose fees on vacant land on the ground, which will significantly revitalize government housing projects at affordable and reasonable prices.
Real estate experts expect the Kingdom’s real estate development companies to succeed in the tasks entrusted to them, for one simple reason: these companies are striving to prove themselves and demonstrate that they possess extensive expertise, and possess significant human and technical capabilities that enable them to execute any projects requested of them.
