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Wed 6 May 2020 01:25 PM

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Home ownership for Saudis increases in Q1

According to JLL, a total of 7,500 residential units were delivered in the Saudi capital of Riyadh, while 1,800 were handed over in Jeddah

Home ownership for Saudis increases in Q1

Home ownership for Saudi nationals increased in the first quarter of the year as the government pushes towards its goal of increasing home ownership to 60 percent by the end of the year, according to real estate consultancy JLL.

According to JLL, a total of 7,500 residential units were delivered in the Saudi capital of Riyadh, while 1,800 were handed over in Jeddah.

The Saudi government’s Sakani programme has the goal of providing more than 500,000 residential units in the kingdom, at an estimated cost of SAR 500 billion ($133bn).

By the end of the decade, the programme hopes to achieve 70 percent home ownership for Saudi nationals.

“In the short-to-mid term, demand remains supported by the Sakani program and the various mortgage products launched over the past couple of years,” said Dana Salbak, the head of MENA research at JLL.

“However, in light of the current conditions and with no specific stimulus package in support of the residential market, we can expect somewhat of a shutdown in demand over the coming period,” Salbak added.

In its report, JLL noted that while the Saudi retail sector saw improvement over the past year, it expects the kingdom to see lower consumer appetite going forward as a result of the Covid-19 pandemic.

By contrast, demand for retail-driven warehousing will be active as restrictions on movement and trade have led to a shift in consumer behaviour, with online shopping (e-commerce) becoming more popular.

“This aligns with some of the strategic goals of Vision 2030, which aims to increase the proportion of online payments from a target of 28 percent this year to 70 percent by 2030,” Salbak added.

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