Saudi Gazette report JEDDAH — The ministries of housing and commerce in collaboration with the Saudi Council of Chambers are planning to develop a new system that will curb rent hikes, local Arabic daily Al-Watan reported Tuesday. According to Abdullah Al-Ahmari, chairman of the buildings evaluation committee at the Jeddah Chamber of Commerce and Industry (JCCI), the new system will make it imperative for landlords and real estate investors to stick to the prices annually fixed by evaluators from the chambers of commerce and also from the Authority of Saudi Real Estate Evaluators. He said: “The move aims to put an end to the unjustified rent rises, especially in major cities.” He said rent levels would be decided by highly qualified evaluators taking into account the age of the building, interior design, the location and other factors. Al-Ahmari noted that during the past three years rent levels had gone up by up to 75 percent and said the rises are exaggerated and unjustified. Meanwhile, the real estate committee at the JCCI said Jeddah courts were currently considering more than 22,000 real estate cases, of which about 80 percent involved disputes between landlords and tenants. A number of experts have warned that paying Saudis annual rent allowances, a possibility currently being debated by the Shoura Council, might result in increased rent and higher prices for building supplies and manpower if the real estate sector was not closely monitored. Shoura Council member Mohammed Al-Quwaihis told local daily Al-Jazirah that paying Saudi citizens annual housing allowance would end the housing problem and enable citizens to obtain their own houses through loans from the Real Estate Development Fund, since they would have extra income to enable them to pay their installments. He, however, warned that the move might result in rent hikes if a system to control rent prices was not introduced. He said: “The Kingdom needs about 2 million new housing units to be able to overcome shortages.” Deputy chairman of the real estate committee at the Eastern Province Chamber of Commerce and Industry Khaled Barshaid said paying housing allowance to Saudis without implementing regulations to control rent hikes would further exacerbate housing shortages. He asked the Ministry of Housing to formulate a strategy to fix prices and prevent random rent rises. He said some neighboring countries have fixed rent increases at a maximum 5 percent over a two-year period.
