Saudi Arabia has emerged as one of the favored destinations for real estate developers to tap unexplored opportunities in housing construction sector. At present the kingdom is facing massive shortage of housing units because of huge demand-supply gap. Rising population coupled with declining household size has been fuelling the demand of housing units in the country.
Saudi housing construction industry is poised for tremendous growth ahead in the backdrop of several factors that have been discussed in the report in detail. As per data from the Ministry of Economy and Planning’s 8th Development Plan (2005-2009), there is shortage of nearly 0.73 Million housing units in the kingdom besides the unmet housing demand of 0.27 Million housing units by the end of 7th Development Plan. We expect this demand to double by 2015, driven by changing industry landscape and favorable policy framework.
We don’t foresee any impact of global financial crisis on Saudi housing industry in near future. The demand levels within the industry will remain intact due to massive shortage in affordable housing segment. In fact we have found that housing construction industry is expected to overtake other sectors in terms of contribution to GDP growth in the coming few years.
The forecast given in this report is not based on a complex economic model, but is intended as a rough guide to the direction in which the market is likely to move. The forecast is based on the correlation between past market growth and growth in base drivers, such as household size, disposable personal income, GDP growth and long-term interest rates, competitive structure, government support, contribution by housing financing industries and growing industrialization.
“Saudi Arabia Housing Sector Outlook” provides extensive research and objective analysis on the growing housing industry of Saudi Arabia, its components and supporting financing structure. This report helps clients to analyze the factors critical to the success of housing industry in Saudi Arabia. Detailed data and analysis help investors, financial service providers and global real estate players navigate through the latest trends in the Saudi Arabia housing industry.
