Saudi Minister of Housing to Al Arabiya: The real estate market is no longer subject to speculation and price exaggerations are declining

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The Saudi Minister of Municipalities and Housing, Majed Al-Hogail, confirmed that the real estate balance program is proceeding according to its set targets, indicating that the real estate market in the Kingdom is witnessing a fundamental transformation from a market dominated by speculation to a market led by real estate development and increased supply.

Al-Hogail said in an interview with Al Arabiya Business that the current indicators show a decline in the price exaggerations that the market witnessed during previous periods, explaining that the primary goal of the balance program was to consolidate the concept of a market based on development and long-term investment instead of speculation.

He added that the real estate market in Riyadh in particular is no longer an arena for speculation with the same momentum as it was before, pointing to the recording of a clear price balance, especially in the peripheral areas that are lower in terms of the level of services, which witnessed noticeable price declines, while prices in the fully serviced areas within the cities began to return to more stable levels compared to previous periods.

Al-Hogail explained that more important than the price movement is the shift that the market is witnessing towards real estate development, stressing that this path represents the main goal of the policies and reforms that have been worked on over the past years.

He pointed out that the white land fees program achieves its development goals, pointing out that the goal of the program is not to collect fees as much as it is to stimulate development and increase the real estate supply.

He added that more than 27 million square meters have applied for development licenses, which will contribute to enhancing the size of the residential supply during the coming period.

He said that increasing supply represents the most important factor in creating balance within the real estate market, whether by increasing the number of housing units or diversifying real estate products, stressing that achieving this balance was and remains the primary goal of the fee program.

On the other hand, Al-Hogail stressed the importance of unifying real estate standards and procedures at the level of the Gulf Cooperation Council countries, stressing that this contributes to enhancing the efficiency of the real estate development system and its associated value chains.

He added that contractors, financiers, designers, and providers of operation and maintenance services are now working on a regional level, and are no longer confined within the borders of one country, which makes unifying guidelines and professional standards an important factor in facilitating business and adopting modern technologies.

He explained that the Gulf markets have today become a unified destination for attracting foreign investments, as the international investor views the region as an interconnected market, which makes the unification of regulatory foundations and professional standards a supportive factor in enhancing investment attractiveness and raising the efficiency of Gulf economies.

Al-Hogail added that the existence of a unified or convergent framework of standards and procedures helps the foreign investor and service providers better understand the business environment in the region, which contributes to enhancing Gulf economic integration and supporting development goals and sustainable growth in the GCC countries.

He stressed that unifying professional and regulatory references in the real estate sector would enhance the competitiveness of Gulf economies and facilitate the movement of investments and services between the countries of the region, which would reflect positively on the real estate sector and economic development in general.