The SR20 billion additional allocation made by Custodian of the Two Holy Mosques King Salman as part of some 37 royal decrees he issued last week would boost the real estate market and bring down prices by 20 percent, said realtors.

“The king’s decision will solve the problems facing some 3,600 housing districts with more than 2 million pieces of land,” said Abdullah Al-Ahmary, chairman of the land evaluation committee at the Jeddah Chamber of Commerce and Industry.

He said the royal decision would ensure provision of infrastructure facilities for housing units. He said many people, especially those having limited income, could not build homes due to lack of electricity and water services.

The Housing Ministry said the SR20 billion bonus would enable citizens to construct housing units in vacant plots received from the government. According to the royal decree, SR14 billion will be given to provide electricity connections to new housing units and SR6 billion to provide water connections.

Khaled Bashuwaier, chairman of the housing committee at the Jeddah chamber, expressed his confidence that the new decree would contribute to solving the housing problem in different parts of the Kingdom.

“Jeddah requires 800,000 housing units during the next 20 years,” Bashuwaier said while stressing the need to develop vacant land to meet housing requirements. He disclosed plans to develop seven huge housing districts in the city.

Khaled Barasheed, chairman of the real estate committee at Asharqia Chamber, said real estate prices would fall by 20 percent as a result of the royal decree in addition to the reduction in prices caused by market depression.

The market has been facing a kind of depression during the past few years as a result of the completion of several projects by the Housing Ministry and due to difficult conditions imposed by banks for housing loans. As a result, many people had canceled their plans to own houses.

Real estate operators believe that the allocation of SR20 billion would boost the market. People having limited income were not able to construct homes in plots of land received from the government during the past 30 years due to nonavailability of water and electricity in those areas.

Al-Ahmary said there was a 35 percent fall in speculative business in real estate. “With regard to housing units, speculative dealings fell by up to 15 percent last month.” He said the real estate market in the Kingdom has reached its peak and during the past four years it was going through a correction process.

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