Real estate experts have confirmed that the requirement for borrowers to pay 30% of the mortgage amount has contributed significantly to the real estate market slump, as citizens have been reluctant to buy due to a lack of financial resources to cover this percentage; the proportion of those able to purchase under these terms has fallen by as much as 40% compared to before the decision was implemented.

The 30% decision has hurt everyone

For his part, Khalid Barashid, Chairman of the Real Estate Committee at the Eastern Province Chamber of Commerce and a member of the Saudi Chambers Committee, noted in press interviews that it has become clear that everyone has been adversely affected by this decision, as citizens" purchasing power has declined—even among those considered to be of moderate financial means who can set aside 10,000 riyals from their monthly salaries—since raising the specified percentage from banks is difficult. Consequently, some have been trying to find ways andways to quickly obtain this amount—whether through a personal loan added to their mortgage—which would further burden them and leave them virtually unable to repay both types of loans, thereby affecting their standard of living. Conversely, if they had received the fulland began repaying it to the bank over a period of 15–25 years in relatively manageable installments, roughly equivalent to their monthly rent payment.

Call to Reconsider the Decision

Barshid called on the Ministry of Housing to negotiate with the Saudi Arabian Monetary Authority to seriously reconsider this decision and seek to revoke it or freeze it for a period of 10 years, returning to the old system, because the housing problem is a long-standing one that has persisted for nearly four decades, and it is wrong to placethe entire burden on the state, represented by the Ministry of Housing, to resolve it. Barshid emphasized the need to contract with as many real estate development companies as possible so that they are distributed across all regions of the Kingdom and are not concentrated solely in major areas such as Riyadh, Dammam, and Jeddah, because eight real estate development companies are by no means sufficient for a country the size of Saudi Arabia, which has led real estate developers in Riyadh to work in Dammam or Jeddah, and vice versa.

Establishment of a General Real Estate Authority

Khalid Barashid, Chairman of the Real Estate Committee at the Eastern Province Chamber of Commerce, renewed his call for the establishment of a supreme real estate authority, to regulate the market and address some of the distortions it faces. He emphasized the importance of pooling all efforts to help resolve the housing crisis, which has made the Ministry of Housing one of the ministries that has seen the most changes in ministerial leadership in recent years—if not in recent months—and this is evidence that that the state is determined to resolve this crisis by seeking solutions that can end or at least mitigate it, noting that real estate development companies possess the necessary expertise to carry out development projects in accordance with the required quality standards.

Strengthening Partnership with the Private Sector

Khalid Barcheed called for the need to uphold the principle of partnership and cooperation between the private and public sectors in a way that serves the common interest and contributes to providing the required housing units, which in turn helps rein in prices at the present time, which would help accelerate the pace of housing provision across the Kingdom. He noted that current demand far exceeds supply, which is driving continuous price increases across the Kingdom in any case.