Saudi Arabia is underdeveloped in real estate terms and in particular the issue of Saudi Arabia Property for sale. This is due to political and financial elements. Banks have been traditionally cautious about engaging in real estate development projects because of regulations that did not allow them to mortgage the properties. This meant that developers had to raise their own financing, usually through private initiatives.
“Now things are changing on both the political and financial sides,” says Ibrahim Bin Fahad Al Assaf, Al Oula's executive vice-president. “Banks are starting to realize the importance of real estate development. In the past, they were running away from these projects, and today they are running to them. Mortgage regulations are in the process of being approved by the government. We expect these to be realized before the end of the year. This will set the groundwork for a mortgage system in the kingdom.”
Expatriates – from other Arab states, the West and the Indian subcontinent – who have lived in the country for ten years continuously can now apply for citizenship, and thus qualify to buy property.
The lack of mortgage facilities has acted as a bottle-neck limiting development, says Al Assaf, and when this problem has been resolved he believes the market will expand quickly with developers selling on a mass level. “We are moving slowly but surely. In Saudi Arabia drastic change does not happen easily but we are continuously changing.”
The company president, Al-Gahtani sees himself as a tool, carrying out King Abdullah's vision of the kingdom's future, and believes that Al Oula will expand to five times its present size in the years to come.