PHOTO
DUBAI- Saudi Real Estate Refinance Company (SRC) has signed a partnership agreement with Real Estate Development Fund (REDF) to refinance a real estate portfolio worth 10 billion riyals ($2.7 billion), SRC said in a statement.
REDF provides subsidised loans to Saudi home buyers and SRC, wholly owned by sovereign wealth fund the Public Investment Fund (PIF), is the Saudi equivalent of U.S. mortgage finance business Fannie Mae.
Founded in 2017, SRC buys home financing portfolios from local banks and real estate finance companies and packages them into shariah-compliant mortgage-backed securities for sale to domestic and international investors.
The agreement supports REDF by "enhancing its financial stability" and aims to boost liquidity in Saudi Arabia's home financing market, cut the cost of home financing for Saudis and support the country's housing objectives, the statement said.
"Therefore, the agreement with REDF positions us as a catalyst in achieving the housing goals stipulated by Vision 2030," which is the kingdom's plan to diversify the economy away from oil, said Fabrice Susini, CEO of SRC.
Vision 2030 aims to increase the percentage of Saudi families owning homes to 70% by 2030. Susini told Reuters in March that roughly 62% of Saudis owned homes.
In September, SRC reached a 2 billion-riyal deal to refinance the portfolio of a housing programme, Masakin, backed by the General Organisation for Social Insurance (GOSI).
($1 = 3.7509 riyals)
(Reporting by Yousef Saba Editing by Louise Heavens and Mark Potter) ((Yousef.Saba@thomsonreuters.com; +971562166204; https://twitter.com/YousefSaba))