Tenants in Saudi Arabia are facing rent hikes of up to 25%, demanding pay increases to help meet the increased cost of living.
Riyadh tenants are worst-affected, with rents rising by 25%, according to a report by Saudi daily Arab News.
Real-estate developer Abdullah Sulaiman Al-Balawi said Makkah rents had increased considerably over the past week. A property owner in Jeddah was reported as having hiked rents by 20%, increasing annual rates on flats to 18,000 riyals ($4,800).
V.A. Tommy, acting general manager of Al-Rajhi Insurance told Arab News a pay hike was needed to offset the cost of living, and that companies were finding it difficult to attract skilled manpower from India and Pakistan.
“If companies do not increase salaries, skilled workers may leave the Kingdom,” he said.
Property owners say increases are inevitable, and that they are receiving just 10% returns on investments by charging old rents, the report said.
Developer Ahmed Faqeeh denied analysts reports that foreign investors are to blame, attributing increases to a growing demand for residential apartments, increased wages, and the rising prices of building materials.
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