The Saudi government's focus on providing more affordable housing to drive home ownership among Saudis will boost the Riyadh’s overall real estate sector, according to JLL.
In line with the National Transformation Program 2020, the Ministry of Housing aims to increase home ownership for nationals from 47 percent to 52 percent through boosting affordable residential supply.
JLL said a continued focus on this sector of the market was evident during the second quarter of 2018 with the Ministry announcing eight new agreements and the distribution of 15,618 affordable residential units.
“While some developers are expanding their high-end offering, most remain focused on the affordable sector of the market in line with the governments’ continued focus on driving home ownership for nationals. This will continue to be a key driver for the real estate market overall,” said Craig Plumb, head of research, MENA at JLL.
He added that despite there being little change in market conditions, the government continues to launch ambitious new real estate projects in and around the capital.
During Q2, JLL said sales and rents of villas and apartments in Riyadh saw single-digit decreases on a yearly basis but stabilised on a quarterly basis.
The latest project, initiated by the Public Investment Fund (PIF), is Qiddiya which includes a significant residential component and aims to attract 17 million visitors to the entertainment sector, 12 million retail visitors and 2 million hotel visits by 2030.
JLL said the total residential stock in Riyadh remained unchanged at around 1.26 million units, with 15,000 units expected to complete by the year-end.
In the office space, the Riyadh market saw the addition of 42,000 sq m in Q2 while the second half of 2018 is expected to see a more significant increase in activity with approximately 151,000 sq m scheduled for completion.For all the latest business 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.
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