During the second half of the last century, the mechanism of real estate contributions achieved great success in providing housing for citizens, as it helped a large number of citizens to own land and build it, and revitalized the market to a great extent in the movement of buying and selling, and achieving good profits for small investors who brought them many benefits in a short time.

Citizens and real estate companies hope to create something similar to the old real estate contributions to invest in them, which contributes to solving the housing crisis and the scarcity of habitable white land due to its high price.

Citizens and real estate companies hope to find something similar to the old real estate contributions to invest in, which contributes to solving the housing crisis and the scarcity of white land suitable for housing due to its high price, with the amendment of some procedures and regulations that preserve the rights of shareholders.

Liquidation of 101 troubled real estate contributions

<To reduce the difficulties facing real estate contributions, the Ministry of Commerce has created a committee to resolve real estate contributions, to address and solve their issues that take decades, as there are real estate contributions looking for solutions to liquidate them for 30 years, and have not yet been resolved. According to a recent report issued by the committee, 101 troubled real estate contributions have been liquidated in various regions, bringing the total amount delivered to shareholders (23.3 thousand shareholders) during the period 2012-2014 to more than 4.7 billion riyals, all of which were frozen rights in the contributions, and the committee is now working on a file with 15 real estate contributions worth up to 4 billion riyals, and considering the rest of the troubled real estate contributions that are currently subject to the work of the committee to liquidate them, their number reaches 275 troubled real estate contributions, about three times the number of what has been liquidated since the establishment of the Real Estate Contributions Committee.

Real Estate Contributions Committee (RECC).

Facilitating the procedures of real estate funds

<Real estate funds have imposed themselves as an alternative to “real estate contributions”, which faced many legal difficulties, which caused the absence of controls that guarantee the rights of shareholders in these contributions, which created many issues that stood in the way of their liquidation and the restoration of rights to their owners. This enabled real estate funds to be a suitable alternative to real estate contributions, provided that the role of these funds is activated, facilitating their official procedures, and encouraging investors to pump their money into them, so that they can be one of the effective solutions to solve the housing crisis in the Kingdom, or at least alleviate it. Real estate professionals point out that the procedures for establishing a real estate fund appear to be semi-complicated and long, and need official procedures that may take a long time, compared to the procedures that were needed to form real estate contributions.

Difficulties facing real estate contributions

The difficulties facing the sale of real estate contributions and benefit are the death of the owner of the contribution and the transfer of the contribution to his heirs according to the law and regulations, or the death of a number of shareholders, and other shareholders did not have heirs to whom the estate is transferred, as well as the lack of agreement among the heirs, which prompted specialists to emulate the mechanism of forming real estate contributions, but after taking measures that guarantee the rights of shareholders.

Real estate professionals believe that the process of forming real estate contributions has taken a long time, compared to the procedures that used to require the formation of real estate contributions. They believe that the return of real estate contributions to the market will work to solve the housing crisis and provide white land among small investors, as these contributions were able to attract many to them, but the issues that occurred in them prompted government agencies to stop the work of real estate contributions, and instead created real estate funds, which faced several complications.

Real estate experts believe that the organized mechanism of real estate funds limits the full use of them.