The Saudi Ministry of Housing unveiled plans to establish two separate companies to boost the growth of the Kingdom’s housing sector. The first company is for facilitating personal housing loans to citizens. The ministry or the Saudi Arabian Monetary Agency (SAMA) will manage the company with the participation of local banks, investors and the private sector. This is part of the ministry’s financial strategy within the framework of the national housing strategy for the coming three years, according to sources at the ministry.
The ministry has also plans to establish a national contracting company with a capital of SR1 billion. The government’s stake in the capital would be 51 percent and the remaining shares would be floated into public circulation. The joint stock company would be operational two years after its establishment within one year. It would issue 10-year bonds to the private sector within three years.
The ministry sources also indicated about other major steps to be taken in line with the national housing strategy. These include transforming the Real Estate Development Fund to Real Estate Investment Bank and upgrading the current system for land allotment in order to take maximum advantage of land in urban areas.
The ministry also projected construction of a total of 1.25 million housing units during the current five-year plan period (2010-14).