Huge demand for new residential properties in Saudi Arabia has led to the creation of a brand-new Ministry for Housing in the country. Rapid population growth and an increasing number of expatriate workers relocating to the nation are expected to be the primary growth drivers.
According to a recent report by Banque Saudi Fransi, some 275,000 units need to be completed by both private and public developers a year through 2015 to meet the country's increasing demand for new homes.
It follows recent comments from international property portal BuyAssociation that a growing number of property investors with cash to spend are looking to increase their wealth by purchasing real estate in Asian property markets.
The new ministry will be led by Shwaish bin Saud al-Duwaihi al-Mutairi and King Abdullah has already revealed that USD 93 billion will be spent in social handouts - including USD 66.7 billion on 500,000 new homes.
"We see that it's a commitment and recognition of a challenge facing Saudis but we don't expect it to have immediate impact, with substantial time needed to deliver the number of housing units," said Monica Malik, chief economist at EFG-Hermes in Dubai.
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