Emptied houses, offices bring Saudi Arabia's land prices down by 30%
The government’s correction campaign has pushed land prices down by 30 percent and closed more than 80 percent of unlicensed real estate offices, local media said quoting property experts.
However, the campaign would have a positive effect over the long-term on the country’s economy and security, said Abdullah Al-Ahmari, head of the real estate evaluation committee at the Jeddah Chamber of Commerce and Industry (JCCI).
He said illegal workers have vacated housing units, notably in less well-off areas, which would allow their owners to rehabilitate and rent them to Saudi citizens at affordable prices, Al-Ahmari said.
He blamed foreign speculators for causing the rise in local property prices. He said the changes in the real estate market would be seen within the next six months. The government’s correction campaign would create enormous job opportunities for Saudis, Al-Ahmari said.
He said 80 percent of unlicensed real estate offices have closed down in the immediate aftermath of the correction campaign.
Khalid Barashid, a property dealer, said the raids have pushed down land prices by 30 percent in suburban areas and wiped out illegal dealers. The Ministry of Labor’s regulations do not allow foreigners to work at real estate offices, even if they are legal residents, he said.
He said the market would soon see realistic pricing. Rentals would be linked to the system requiring landlords to provide detailed information on tenants, he was quoted as saying.
Abdullah Al-Otaibi, a property expert, agreed that the inspection campaign would reduce the manipulation of property prices by unlicensed real estate offices.
- How will plunging oil prices affect Dubai's glittery real estate sector?
- Home prices in Israel makes making ends meet impossible for families
- Putting their eggs in tourists' baskets: why Dubai's real estate developers are shifting to hospitality
- Is Dubai's property market finally displaying 'affordable' tendencies?
- Ironic much? Sharjah's 'affordable' rents is the exact reason they're now skyrocketing