Saleh Al-Zahrani Okaz/Saudi Gazette JEDDAH — Specialists and realtors have identified five urgent measures that are needed to solve the housing problem in the Kingdom. They believe that steps to control land prices, essential services in old and new land schemes, reducing the cost of financing, speedy implementation of housing project comprising 500,000 residential units and more low-cost housing projects would help end the crisis. The Kingdom's housing crisis is one of the issues to be discussed at the ongoing Jeddah Economic Forum. The head of realtors in Jeddah Khalid Al-Ghamdi is hopeful that the forum will result in clear solutions to the housing problem in the Kingdom and the Gulf. He said the discussions will be beneficial as the forum will draw from similar experiences in other parts of the world. He believed that the first obstacle in overcoming the housing crisis was inflated land prices. This has caused citizens difficulties in finding a suitable piece of land to build a house. He said that the cost of a piece of land accounts for 60 percent of the total cost of a residential building. The lack of essential services to numerous land schemes has added to the problem. If such services are made available, it will increase the supply of land suitable for residency and reduce land prices. Turki Al-Turki, an expert in business and projects development, said the increase in property funding costs by 40 percent has had a knock-on effect on the cost of residential units. He called for a temporary halt to the cumulative interest system. He believed that the housing problem should be solved by government bodies to avoid the influence of market forces in the private sector. He added that the private sector would not accept a profit of less than 80-90 percent of the cost of a project. Al-Turki questioned the delay in Custodian of the Two Holy Mosques King Abdullah's project to build 500,000 residential units. The project cost of SR250 billion has already been budgeted and approved and the project was entrusted to the Ministry of Municipal and Rural Affairs. Realtors said foreign companies should be contracted to provide their expertise in such matters. They said all current indicators point to a continued housing problem, and an estimated demand for residential units at 150,000 a year. The head of the property evaluation committee, Abdullah Al-Ahmari, said there is a need for more low-cost housing units. The minimum deposit payment should be reduced, he added, so that limited income families can afford to buy such units. He also called on the Ministry of Housing to solve the problem in cooperation with the banks. Priority should be given to limited income families who cannot afford to buy a residential unit from the private sector, he said.
