Surplus, undeveloped residential plots around Riyadh are estimated to be 490 square kilometers in total, a new study by the High Commission for the Development of Riyadh (HCDR) shows. The present demand for residential lands in the city can be met by only 30 percent of these plots.
The study measures supply and demand indicators of property development in Riyadh in 2012 and estimated that there would be a total demand for 510,000 homes in the city by 2028. The study calculated that 30,000 residential units would be required annually.
The study showed that Riyadh is home to more than 960,000 residential units of different types.
Based on current trends, the study recommended that government loans should encourage the development of housing units on easy terms for low and middle-income people to satisfy future demand.
The study called for the establishment of controls and requirements regulating the activities of real estate brokers. It stressed the need to give priority to the development of approved under-developed areas.
The report studied future supply and demand until 2028. There were estimates for various sub-sectors such as residential, commercial, office space, hotels and the industrial sector.
"About 5.7 million people live in Riyadh. The annual population growth rate stands at 4 percent, and the number of Riyadh inhabitants will reach 8.3 million by 2028," the report said.
The present area of the developed parts of Riyadh stand at 1,300 square kilometers, which houses various types of property, including residential, commercial and industrial property.
The area available for urban development until 2028 is estimated to be around 3,115 sqk.
There would be increasing demand on duplex-type housing and residential flats, the report predicted. It also expected the number of vacant residential units to reach 7 percent within two years.
"By 2028, the number of residential units available in developed areas will stand at 1.03 million units," the report said.
In the business sector, the report expected a sustained short-term rise in rents, especially for retail stores within major shopping centers.
With regards to the hospitality sub-sector, the report estimated that the number of hotel rooms would increase by 6,500 rooms in the next year.