Riyadh, Asharq Al-Awsat—New measures to increase the visibility and regulation of Saudi Arabia’s real estate sector will have positive effects including drawing in new investors and stamping out unwelcome practices, sector specialists have told Asharq Al-Awsat.
The Ministry of Justice launched on July 29 new real estate indices—36 in total—to facilitate the trading of property in the Kingdom as part of an initiative launched by Custodian of the Two Holy Mosques, King Abdullah Bin Abdulaziz.
The indices will provide the real prices of land and property in different areas of the country, allowing customers to easily compare prices of similarly classified real estate throughout the Kingdom.
They will also show regularly updated information regarding the size of the market, allowing analysts and investors to monitor growth and slumps in the sector.
Speaking to Asharq Al-Awsat, real estate specialist Khalid Al-Ghaliqa said the new indices would quickly make clear to investors and developers which lands were developed and which were not.
He predicted that the indices will open up avenues for new projects and investments for undeveloped lands, a positive development especially in light of the government’s recent initiatives to establish residential projects to solve the Kingdom’s housing shortage.
Abdullah Al-Maghlouth, a Saudi real estate market analyst saw the launch of the indices as a vitally important step for the sector, one that would help increase visibility and promote healthier regulatory practices. He told Asharq Al-Awsat he expected the coming period to see an increase in investments into the sector—among them from new investors—as well as an exodus of speculators and price fixers.
He also believed the new indices would likely reduce legal battles over the prices of real estate assets, as they were based on information provided from specialized companies operating in the sector.
He praised the Justice Ministry for consulting heavily with specialists in the industry in setting up the necessary mechanisms for the indices, adding that there would be even more visibility for the sector in light of the subsequent media coverage.