Saudi Arabia is facing a housing crisis and requires 350 million square metres of new accommodation to meet its burgeoning demand, an economic forum in Jeddah has been told.
Abdullah Sadiq Dahlan, an organiser of the Jeddah Economic Forum (JEF) and chairman of the board of trustees at the University of Business and Technology, warned the kingdom did not have realistic plans in place to avoid a severe shortage of housing, Arab News reported on Monday.
Saudi Arabia, the biggest Arab economy, is facing a massive housing problem due to rapid population growth and an inflow of expatriate workers enticed by jobs in oil and construction.
The population is estimated to have doubled in size since 1988 and is thought to be growing at more than 2 percent annually.
Dahlan said two-thirds of the population already lacked affordable housing, with 30 percent living in inadequate housing.
Despite land covering more than 2 million square metres, the majority of the kingdom’s residents live in major cities such as Riyadh, Jeddah and Dammam, but the cities lack the housing density required of such populations.
About 5.2 million, or about 20 percent of the total population, live in the capital, Riyadh, while Jeddah has a similar population in a smaller area, making it the country’s most densely populated city.
The kingdom has said it plans to spend as much as US$67 billion on new homes for Saudi nationals across the kingdom.
In January it announced 12,400 homes would be built using new loans with the Real Estate Development Fund worth SR5bn ($1.3bn).
According to Jones Lang LaSalle estimates, about 6,000 new homes were added to the Riyadh's residential market during the third quarter last year and another 100,000 will be built in the city by 2015.
In 2011 it was reported Saudi Arabia needs 1.65 million new homes by 2015 to meet growing demand, according to Banque Saudi Fransi.