Addressing Saudi Arabia’s growing demand for middle-income housing
Growing urbanization, shifting demographics and continued economic growth and diversification in Saudi Arabia are driving an unprecedented expansion in demand for housing for middle-income families. This will continue as the country’s youth bulge enters the workforce and moves toward middle-income status, looking for homes of their own.
Experts have identified near-term demand for more than 400,000 new homes for middle-income households, which make up over 60 per cent of all households in the country. In response, the government has expanded its residential construction programs, aiming to build 1.5 million homes over the next seven years, as part of wider plans to double the real estate sector’s contribution to Saudi Arabia’s GDP to 10 per cent by 2020.
The government is also placing a greater emphasis on partnering with the private sector, creating opportunities for private developers to support the government on this new program and generate a positive social impact.
In line with Vision 2030 and the National Transformation Program, a number of regulatory changes will allow private developers to play a greater role in accelerating the supply of affordable, yet high-quality housing across Saudi Arabia. For instance, a tax has been implemented to help developers acquire more unused land and priority is being given to projects that are financed and developed through the Public Private Partnership (PPP) route.
Abdul Latif Jameel’s Land and Real Estate Development division has a broad range of initiatives already underway in Saudi Arabia, and its previous projects in the country showcase its abilities to create high-quality, affordable neighborhoods.
For example, Emaar-Jameel, a partnership with Dubai-based global property developer Emaar Properties, is overseeing the creation of a number of master-planned communities. This ambitious venture will use the latest construction technologies to build integrated commercial and residential districts.
These large-scale developments will feature residential properties, leisure and recreational facilities, commercial buildings and retail outlets. They are part of Abdul Latif Jameel’s wider and continuing investment efforts to help the country to meet the growing demand for affordable homes in the country. Alongside this, these communities will help to generate jobs and investment through related service sectors and enhance the overall infrastructure in the surrounding areas.
As one of Saudi Arabia’s leading land and property developers, Abdul Latif Jameel Land is well placed to work with the government and other partners to strengthen the future of the country’s housing sector.