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Sun 27 Mar 2011 03:10 PM

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Saudi consultative council resumes debate on draft mortgage law

The law aims to bring private lenders into the market by adopting a clearer set of rules

Saudi consultative council resumes debate on draft mortgage law
MORTGAGE LAW: Saudi King Abdullah must approve the mortgage law if it’s passed by the council

Saudi Arabia’s Shoura Council started a fresh debate on a draft mortgage law on Sunday, according to a member of the consultative body.

Saad Mariq, deputy chairman of the council’s financial committee, said in a phone interview he didn’t know how long it might take for the council to approve the law.

The law, originally submitted about two years ago, aims to bring private lenders into the market by adopting a clearer set of rules. Saudi Arabia, the world’s largest oil exporter, needs 900 new houses a day completed over the next five years, according to a Jones Lang LaSalle report released on Sunday.

Saudi King Abdullah must approve the mortgage law if it’s passed by the council. The king on March 18 ordered the construction of 500,000 houses for Saudis at a cost of SR250b ($67bn).

The Saudi monarch also raised the value of mortgages provided to nationals by the country’s Real Estate Development Fund to SR500,000 from SR300,000.