Guided by the stewardship of His Excellency Majed bin Abdullah Al-Hogail, the Minister of Municipal and Rural Affairs and Housing, Saudi Arabia is witnessing a revolutionary change in its housing sector. Anchored to the ambitious goals delineated in Vision 2030, the nation endeavours to escalate the homeownership rate to an impressive rate of 70% by the end of the decade.
The real estate landscape, constituting approximately 7% of the national GDP and engendering 40,000 employment prospects in 2021 alone, stands as a pillar of Saudi Arabia’s economic framework. The ongoing diversification strategies foresee an augmentation of its GDP contribution to 10% by the envisioned 2030.
The initial stage of the Housing Programme under the Vision 2030 has already fruitfully attained its objectives, which encompass:
- Broadening financial accessibility
- Launching cost-effective housing products in the market
- Incorporating efficiencies in the operational dynamics of the housing sector
- Energising the foundations of the property sector, and
- Enhancing the Housing programme governance mechanisms.
The culmination of these efforts has reflected in a substantial surge in the housing supply, fulfilling the homeownership dreams of numerous Saudi households. A milestone of 62% home ownership was achieved in 2020, steering firmly towards the 70% target set for 2030.
Spearheaded by the Sakani programme, a staggering 210,000 Saudi households reaped the benefits in 2021 alone, elevating the aggregate to a monumental 1.2 million families. This era also witnessed a formidable expansion of the mortgage market, with contracts valued at SAR 140.7 billion being granted in 2020.
Looking ahead, the subsequent phase of the Housing Programme pivots towards nurturing the less privileged community segments and cultivating deeper private sector engagements. An imperative in the journey to foster sectorial resilience and adaptability, private sector collaborations stand central in navigating diverse economic scenarios.
As the decade unfolds, Saudi Arabia foresees the start of around 1.2 million new homes, targeting a total inventory of 4.96 million residences by 2030. With housing demands poised to rise from 99,600 units in 2021 to an estimated 153,000 by 2030, the average annual requirement is assessed to be 124,000 residences.
Undeniably, the past decade has beheld a transformative journey for Saudi Arabia’s housing sector, characterized by unprecedented strides towards achieving the Vision 2030 benchmarks of 70% home ownership and contributing 8.8% to the national GDP. This forward momentum, spurred by governmental rigor and the activation of diverse financial instruments, is dismantling hurdles in the housing market, thereby unlocking doors to home ownership for forthcoming Saudi generations.
Embodying a beacon of success, Saudi Arabia’s housing sector metamorphosis promises to resonate deeply within the societal fabric, crafting a narrative of growth and opportunities for years to come.