Amlak-Survey
The recent period witnessed very important fluctuations in the global economy, which in turn affected large sectors of local economic activities, especially the fall in the global oil price, which fell to 50%, and the recommendation of the International Monetary Fund to the government of the Kingdom of Saudi Arabia coincided with the ideas and wishes of the Ministry of Housing when the Monetary Bank recommended several internal measures to compensate and bridge the economic gap, one of the most prominent recommendations was to impose taxes on unused white land within the urban area.
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Amlak Real Estate newspaper anticipated the events and polled a number of real estate professionals and specialists with the following question:
Which investment destination is the real estate sector's money heading to after the implementation of the white land fees decision and the fall in real estate prices?
Stock market. Potential Risks First, Abdulrahman Al-Obaid, General Manager of Al-Maraba Consulting Company, explained that real estate investments, especially land, will shift to other commercial activities such as shopping centers and malls to avoid losses that may result from the implementation of the upcoming decisions, The money generated from the sale or investment of white land will contribute to opening new lines of capital circulation, and some will resort to investing in hotels and entertainment centers. Al-Obeid referred to another simple category of 5% whose money will go to bank balances through deposits to freeze again because their returns are simple, and there is a third category that will try to enter the stock market, which real estate professionals consider an unsafe haven for its fluctuation and instability of its index, which is quickly affected by economic shocks or any other factors; through the reality of their experience in 2008, Al-Obeid continued, pointing out that a small percentage of the real estate tribe will benefit from their relationship with the real estate community to enter activities close to it or complementary to it, such as entering the building materials and construction sector, whose trade will flourish in light of the expected urban renaissance after the land monopoly is broken. Fraud by developing part of the land For his part, businessman Mohammed bin Abdulrahman Al-Mousa divided the conditions of real estate into two categories: those who own plots of approximately 1000 to 10000, and this category will have to rent them or sell part of them and develop the rest, and some of them are able to develop them completely if they find the liquidity with them, As for the second category, they are the owners of large raw lands and those who seek to develop part of it, such as one third of it, and the government will not ask him to develop all the land at once, he will develop it in stages that take several years, and time will change the procedures and regulations to come, and Al-Mousa believes that the owners of these large properties will not be able to exit and collide with a difficult reality because there are no buyers for a certain period, so inevitably they will be moved by any methods that ensure their exit from taxes and they are smart. The construction market is the ultimate incubator In the same direction, Al-Muhannad bin Mohammed Al-Saeed, a real estate expert, believes that owners of small plots of less than 10.So they will dispose of them by selling them to turn them into cash and possibly their money will go to the construction market, which will revive with the expected development movement, and Al-Saeed warned that real estate in general does not impose in their lands, and a large number of them will keep part of the land, As for the large real estate owners who own vast lands and plans, they are not affected by the decision much because they have other sources of income that cover the fees they will pay, and there are those who own 8 million meters will know well their measures, and a large number of owners will resort to circumventing the imposed fees in several ways, including renting part of the land and fencing the other part. Alliances with real estate developers Ibrahim Al-Zeer, a consultant at Zood Real Estate Company, believes that the opportunity is now favorable and good if the roles are integrated to achieve the desired public interest from the implementation of the decision to impose fees on land, so I expect that many funds will not leave the boundaries of the real estate market, but will strengthen and strengthen the thorn in the real estate reality with a strong alliance between landowners and developers to implement housing with the required specifications and prices that are within the reach of low income families so that the supply is consistent with the demand, The alliances will lead landowners to break into the fields of real estate development and contracting, which will benefit all parties, including the citizen and then society, and I expect that in the future, residential urban development will take into account in its products the privacy of the Saudi citizen and meet his aspirations in finding a suitable housing for his family. The Zood consultant called on the government to intervene by developing a mechanism that encourages and incentivizes the development of some lands for multi-storey residential towers, in order to achieve rewarding benefits for landowners and developers and provide a large number of residential apartments at affordable prices.
Three-way partnership for development In line with the rule that says God bless those who benefit and benefit, Zafer Mohammed Al-Mutairi expresses his opinion, saying that real estate money only goes to real estate, so it is likely that new companies will appear on the map and work with a new concept to achieve the greatest gains between the constituent parties, which are based on three partners: landowners, real estate developers and banks, It will constitute a striking force in the market if it has lofty goals that save landowners from fees and open new horizons for developers to breathe life into the outskirts of cities and rebalance the real estate market by providing housing products in new neighborhoods, and the investment ring is integrated by opening service outlets such as shopping centers, laundries, catering, hospitals and other investment facets that receive real estate funds. Forming companies to solve the housing issue In a different context, Engineer Ahmed Al-Wakeel, Chairman of Avenue Real Estate Development Company, believes that there are two directions for the best and most profitable investment and stability is to invest in commercial real estate and establish commercial centers, commercial and residential buildings, and these whose prices increase gradually because the need for them exists. The other trend is to invest in real estate outside the Kingdom.
In my opinion, the right choice now for real estate investors is to invest in establishing giant development companies like Emaar that develop their properties and are sponsored by the state to serve everyone and provide job opportunities for citizens and make profits for real estate and contribute to solving the housing issue that worries officials.
