90% of Saudi mortgage contracts are subsidized
The REDF in Saudi Arabia revealed that 90% of the total new mortgage contracts executed by banks and financial institutions last July are backed by profits from the Fund's Subsidized Mortgage Program, stressing that this reflects the high demand for the subsidized mortgage program, which is an indication of the success of the plans provided by the program for its beneficiaries.
For his part, the general supervisor of the REDF, Khalid Al-Amoudi explained that the real estate fund's share increased from 7% in 2017 to 90% of the total financing contracts signed by the end of July, in the Saudi market, announced by the Saudi Arabian Monetary Agency (SAMA) by the end of August 2019, which is an unprecedented indicator of real estate growth in the history of Saudi banks and a success for citizens' housing plans.
Al-Amoudi stated that the announcement by SAMA on the continuation of the growth of mortgages and the highest number in the history of Saudi banks of 16,000 financing contracts with a total value of SAR7.2bn in terms of mortgages to individuals during the month of July, confirms the continuation of the success of the transformation program implemented by REDF and the trust of the beneficiaries, noting that the Fund has completed the housing support measures for 131,000 families who owned housing until the end of last month.
Al-Amoudi pointed out that REDF is working on innovating and developing possibilities, in addition to electronic services in order to facilitate and simplify the procedures of real estate finance to enable the beneficiary immediately from the subsidized mortgages with the aim of enabling citizens to have access to housing, within an ambitious vision that achieves its goals to increase the ownership rate to 60% by 2020.
Al-Amoudi noted that the growth of mortgages since the beginning of the current year 2019 represents a firm conviction among citizens in financing and housing solutions, and that the housing program 2020 includes a system of government agencies all working to enable citizens to own houses, indicating that this system formed a distinctive government business model to achieve the government's aspirations of all that serves the citizen in the field of housing, calling on citizens whose applications have been approved or who are on the waiting lists to take advantage of various financing and housing options.
It is noteworthy that the REDF reviews monthly programs, initiatives, and financing solutions, as well as the development of its e-services to save the effort and time for the citizen to obtain a mortgage backed easily to achieve his dream of owning housing, and the number of housing mortgage contracts for individuals is growing continuously—at the end of 2018, it amounted to 50,496 contracts with a total value of approximately SAR29.5bn, while in 2017 it was about 30,833 contracts worth SAR21,025bn. In 2016, the Fund witnessed the signing of 22,259 financing contracts worth SAR17,096bn.
