Riyadh, Asharq Al-Awsat – Saudi Arabia has approved a draft law that will allow mortgages to be sold in the Kingdom, the state news agency said on Monday.
The Saudi Press Agency [SPA] revealed that during a cabinet session chaired by Custodian of the Two Holy Mosques, King Abdullah Bin Abdulaziz, a number of new financial and real estate systems were approved.
The draft law lays down the regulations to establish mortgage companies and their activities.
The SPA statement read as follows:
“The Cabinet approved the financed leasing system as attached to the decision; and the Saudi Arabian Monetary Agency [SAMA] will supervise and monitor the financed leasings
The Cabinet approved a registered real-estate mortgage system as attached to the decision.
The Cabinet approved a real estate funding system. The Ministry of Finance in cooperation with the Ministry of Housing and concerned bodies are asked to set the general policies of real estate funding system.”
Following this, Saudi Minister of Finance, Dr. Ibrahim bin Abdulaziz Al-Assaf, thanked the Custodian of the Two Holy Mosques, King Abdullah bin Abdulaziz Al Saud and Crown Prince Salman bin Abdulaziz Al Saud, for the Cabinet’s approval of a package of real estate funding systems.
In a statement, Dr. Al-Assaf told the SPA that these financial and real estate systems constitute a new financial sector affiliated to the Ministry of Finance of the Kingdom of Saudi Arabia.
He added “these systems will help to find organized mechanisms for funding of housing in the Kingdom in a manner that guarantees the preservation of the rights of all concerned parties, whilst curbing the costs of real estate funding by providing easier measures for citizens to obtain this in accordance with Sharia rules.”
He also revealed that these new systems will be implemented pending the issuance of a number of important steps by SAMA.
Dr. Al-Assaf highlighted that these systems are the Real Estate Funding System, Control of Funding Companies System, Financed Leasing System, Registered Real-estate Mortgage System and Judicial Implementation System.