A proposal by Shura Council member Dr. Fahd bin Jumaa Al-Qadi to impose fees on residential units (apartments, houses, villas) to curb rising prices. Reactions have been mixed, as this proposal comes from the council member approximately four months after the decision by the government to impose fees on undeveloped land.
The Recommendation and Reactions
Dr. Fahad Al-Jumah, a member of the Shura Council, said: «The recommendation calls for imposing fees on residential units that have not been rented for a period of 6 months, which would eliminate the hoarding of rental units to control the market and drive up prices.»
He explained that he will present this recommendation during the discussion of the housing report at an upcoming session, and if implemented, property owners will have only two options: either pay the imposed fees or quickly invest the property. It is worth noting that next Ramadan will mark the start of collection of the fees approved by the government in November, amounting to 2.5 percent of the value of land located within urban areas.
Saudis" reactions to the council member’s proposal to impose fees on residential units (apartments, houses, villas) that have been vacant and unoccupied for more than six months. The proposal aims to drain the rental market to control prices and prevent them from rising.
Vacant Housing and the Damage
Fouad Al-Melhem, a member of the Eastern Province Chamber of Commerce’s Commercial Committee, stated that the owner of a vacant residence is the one harmed by its failure to be rented out, and added in a tweet on his Twitter account: ”In response to the wishes of some, we call on our wise government to urgently impose fees on everyone who has requested them and to meet their demands, starting with those who have called for fees on vacant housing."
He was supported by Abdulmohsen Al-Muqrin, CEO of the Abdulmohsen Al-Muqrin & Brothers Group, who wrote: » We also propose fees for Shura Council members who submit proposals against the interests of citizens, and that their performance be reviewed periodically to replace them with better candidates. Regarding the issue of fees, he said: ” "First, let them implement land fees—which are the most important—because half of our cities consist of undeveloped land, and society is deprived of it."
A well-known real estate expert said: " Only a businessman who seeks to exploit citizens” need for housing would oppose this," and asked: "Why don’t they come up with solutions to curb the exorbitant price hikes for tenants? Most homes in Jeddah are nearly empty, and if this regulation were implemented, it would be better than imposing fees."
A Twitter user wrote: ” There are hundreds of massive towers in Mecca that are closed just for the Hajj season, and the people of Mecca are struggling terribly to find a decent apartment at a reasonable price." And "Shadow of the Clouds" wrote: "A sound decision… It must be followed by other decisions to rein in the greed of landlords and real estate agents, whose already overflowing pockets can never be satisfied."
Why are there vacant homes?
Meanwhile, another citizen said: "Today it’s vacant homes… tomorrow it’ll be fees on homeowners… What are the Shura Council members thinking?!" He added: "First they imposed fees on hoarded land, then they turned their attention to vacant homes.«
Meanwhile, a businessman supported Dr. Fahd bin Jumaa’s idea, saying: "I support the idea, and I hope everyone will look at the issue from a perspective that goes beyond personal interests—let’s think about the public interest of society." Engineer Munif Al-Rouqi added: "It’s an excellent initiative if it were to be adopted by the Shura Council or the Ministry of Housing—though I doubt either of these bodies would do so, out of deference to the real estate tycoons."
Real estate tycoons
Citizen Hamad Al-Omar said: "It should be enforced only on newcomers and not on real estate tycoons; it is well-thought-out and planned in advance, like other plans, and its objectives have become clear." He added that "they should impose fees on vacant land and taxes on abandoned homes."
Citizen Amer Al-Khalifa criticized the statements of some council members, saying: "I demand that fees be imposed on banks, insurance companies, and violators of labor laws, and that property owners of vacant properties be left to their own devices," he said. " The Shura Council is made up of the cream of the crop, but they are not infallible; strict fines must be imposed on those who err so that they bring out only the best in themselves."
Shura Council member Dr. Fahd bin Jumaa explained that he would present this recommendation during the discussion of the housing report at an upcoming session, and if implemented, property owners will have only two options—and no third: either pay the imposed fees or invest the funds quickly.
It should be noted that fees on undeveloped land will be collected at a rate of 2.5% starting next November, based on the value of the land located within the urban area.
