Saudi Arabia’s government will provide housing for 100,000 low-income families over the next year as part of a reform programme designed to strengthen the economy and reduce its dependence on oil, the housing ministry said on Sunday.
The announcement suggests authorities are keen to show swiftly that the reform plan, announced last week, is delivering tangible public benefits. The plan will also involve economic pain as taxes are raised and subsidies are cut.
“In line with Saudi Vision 2030, 100,000 housing products will be allocated and delivered to citizens entitled to subsidies,” the ministry said via Twitter.
The assistance to the families, in the form of land, villas, apartments or financing, will be extended over a year starting on May 8, the ministry said, without giving further details.
Among dozens of economic and social goals, the Vision 2030 plan aims to increase the rate of home ownership among Saudi citizens by 5 percentage points by 2020 from 47 per cent now.
“We will meet this target by introducing a number of laws and regulations; encouraging the private sector to build houses; and providing funding, mortgage solutions and ownership schemes that meet the needs of our citizens,” the plan said.
Over the last few months, authorities have taken several steps to improve the supply of affordable homes. In December, the central bank decided to license a national home finance company, Bidaya.
In February, the central bank said it would launch an “affordable mortgage” programme under which home buyers would be responsible for an advance payment of 15 per cent of the property’s value. Commercial banks would supply a further 70 per cent, as well as an additional 15 per cent that would be guaranteed by the ministry of finance.
Follow The National’s Business section on Twitter