Saudi 'more immune' to credit woes
Riyadh, October 7, 2008
Demand on Saudi Arabia's real estate market will not falter as high oil prices help shield the world's top-oil exporter from the global liquidity squeeze, Emaar's Saudi unit chief executive said.
'Saudi Arabia is more immune to the credit crunch (than other markets) if high oil prices persist and because the central bank imposes stricter rules on lending,' Fahd Al-Rasheed told Reuters on the sidelines of a real estate conference.
'Demand on properties will continue to be high as supply will not meet demand because more people will need housing.'
Saudi Arabia needs more than 6 million units over the next 12 years and 65 percent of the population is under 30, according to Rasheed.
Emaar Economic City is spearheading the development of the Jeddah-based King Abdullah Economic City, which the Saudi government has said could attract 100 billion Saudi riyals ($26.67 billion) in investment.
Rasheed expects property prices to surge by 15 percent next year, adding that if a proposed mortgage law is passed, it will further increase demand on properties as more people will be able to afford purchasing houses.
The long-anticipated mortgage law is expected to allow much wider access to property ownership in a country where only one out of five Saudis owns a home. -Reuters