JEDDAH: Some businessmen believe that rent and land prices will fall now that citizens can get homebuilding loans from the Real Estate Development Fund without having to own land. King Abdullah, Custodian of the Two Holy Mosques, had issued this order to make it easier for citizens to obtain loans. The order included an increase in the fund's budget, which some think may help to reduce waiting lists and bring down prices. Most real estate investors believe that the King's Housing Project, which provides housing units for six million citizens and which has an allocation of SR260 billion, will enable medium and low income citizens to own their own houses. They think the difference may be seen in three years' time. Abdullah Bin Saad Al-Ahamari, Chairman of the Real Estate Committee at the Jeddah Chamber of Commerce and Industry, believes that rents in Jeddah and Makkah will fall by 50 percent in three years' time. This will be the time taken to complete housing projects in Makkah ordered by Prince Khaled Al-Faisal, Emir of Makkah Region. Al-Ahamari said the 25,000 housing project in Khaleej Salman will contribute to the development of the area. Citizens will pay easy installments for these housing units. The low-budget Khaleej Salman housing project was launched by Prince Khaled last week. The Prince's Project also includes projects in southern Al-Rawabi and close to the Navy Base in Jeddah. Added to this is the development of Qasr Khuzam Area in South Jeddah. He said there will also be a fall in vacant land prices because of the taxes being levied on this type of land if no building takes place. Khaled Al-Ghamdi, Chief of the Real Estate Society in Jeddah, disagrees with Al-Ahamari and said speculation will continue to drive up prices. A small deluxe villa now costs one million riyal, he said. The price of real estate “may remain stable and speculation may calm down” until there is a clear idea of what will happen with “faltering housing projects”.
