The housing program; one of the key goals of the Kingdom’s Vision 2030; is on track to achieve its target well ahead of its schedule; according to the IMF report.
“The aim under Vision 2030 was to raise the homeownership rate from 47 percent in 2016 to 60 percent by 2020 and further to 70 percent by 2030. The homeownership rate in 2020 was 62 percent;” the report pointed out.
Mortgage lending in Saudi Arabia continues to grow rapidly as government programs also have supported housing demand and supply; the report noted.
According to the global financial agency; real estate developers have added around 344;000 new housing units in 2020 — an increase of 4.1 percent from 2019 of which 30 percent was also supplied through the partnership with the private sector program (Shrakat) and the developers’ platform Etmam.
The IMF said that financing programs in the Kingdom have also increased. The Sakani program provided around 266;000 residential loans and free land packages in 2020.
Under this program; beneficiaries can obtain subsidized mortgage loans up to SR500;000. Low-income households can obtain a mortgage guarantee and also subsidized loan up to SR500;000 or free land parcels.
According to the report; the value of new residential mortgage contracts increased by 84 percent in 2020 to reach SAR 136 billion; of which 96 percent were government-subsidized loans. Real estate prices have stabilized in 2020 after falling sharply during 2015-19.
Government initiatives to enhance market regulation and efficiency have yielded results; the IMF noted adding that digital solutions for homebuyers have speeded eligibility checks and applications and allow easier access to financial products for homebuyers.