Real Estate Refinance Company aims to refinance 20% of Saudi Arabia's mortgage market over the next 10 years
The Saudi Real Estate Refinance Company (SRC), a subsidiary of the Public Investment Fund, has agreed to a SAR 750 million ($200 million) purchase of mortgages from a number of mortgage providers and local banks including Banque Saudi Fransi, the company announced on Saturday.
The agreement comes shortly after SRC completed a SAR 750 million ($200 million) as part of a December 2018 programme that allows it to issue SAR 11 billion in IslaFic bonds.
The agreement was signed by SRC CEO Fabrice Susini and Rayan Mohammed Fayez pm the sidelines of a financial sector conference held in the Saudi capital of Riyadh.
In a statement, SRC said the portfolio acquisition is a reflection of its desire to make further liquidity available in the Saudi housing market, which in turn offers capital relief to lenders and will enable financial institutions to offer more accessible housing finance solutions to homebuyers.
“This announcement validates SRC’s purpose within a vibrant housing market, but for it to reach full potential we must ensure that there is improved supply of new homes whilst also making these homes affordable and accessible to more Saudi citizens,” Susini said.
“This agreement is a visible demonstration of how SRC makes further liquidity being available for the Saudi housing market which will ultimately make every Saudi citizen’s dream of owning a home a reality,” he added. “That said, the agreement will further increase Banque Saudi Fransi’s ability to offer more accessible home buying solutions.”
Founded in 2017, SRC aims to refinance 20 percent of Saudi Arabia’s mortgage market over the next 10 years.
The kindom’s mortage market is forecast to grow to SAR 500 billion ($133.5 billion) by 2020 and SAR 800 billion ($213.6 billion) within the next decade.
Last week, Susini told Reuters that the company aims to issue as much as SAR 4 billion ($1.07 billion) of long-term sukuk this year as it prepares to purchases more home loan portfolios from mortgage companies and banks.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.