Rental rates in Makkah drop by 30%

MAKKAH — Monitoring and supervising programs of the Ministry of Housing led to stagnation in the real estate sector in the Makkah region and a drop in the rental rate of apartments by about 30 percent compared to previous years.

A lot of «apartments for rent» signs are hanging on buildings in the holy capital as owners and investors have lost their confidence in real estate offices to rent their units.

The recession also cast a shadow over the building owners and investors in the sale of apartments and villas. The decline in selling and buying rates of apartments is attributed the reluctance of citizens to buy in anticipation of the programs launched time to time by the Ministry of Housing.

«Many investors in the real estate market, especially the owners of the condominiums and villas construction and marketing companies, are in a state of anxiety. Some of them are threatened with imprisonment and some of whom have already been jailed, because they have received bank financing and built a lot previously,» said Nasser Al-Zahrani, a real estate developer.

«The owners of these companies are required to pay the back loans and the funding they have received from the banks. Therefore, we hope the ministry officials would help the real estate market return back to normal.»

Salem Al-Qurashi, real estate agent, told Okaz/Saudi Gazette that the majority of real estate offices suffer from recession despite the presence of large capital, but citizens need to be reassured until they regain confidence in the real estate market.

Real estate developer Abdullah Khudair told Okaz/Saudi Gazette that the reason for the drop in rents of residential apartments is the state of anticipation currently experienced by the community waiting for what would result from the promise of the Real Estate Fund.

© The Saudi Gazette 2017