Saudi Mortgages for individuals jump to 429% in 2019

Saudi Mortgages for individuals jump to 429% in 2019

With 68,000 mortgages during the first half of 2019, the Saudi Arabian Monetary Agency (SAMA) on Monday revealed the growth of housing loans to individuals from all financial institutions of commercial banks and financing companies during the month of June by 429% compared to June 2018.

The monthly statistical bulletin issued by SAMA revealed that the number of new residential mortgage contracts granted to individuals from all mortgage lenders from banks and finance companies amounted to 9,711 contracts with a total value of SAR4.362bn, achieving a growth rate of over 309% year on year.

SAMA pointed to the continued growth in a number of real estate contracts to citizens, supported by government housing programs, bringing the total number of loans provided during the first half of 2019 to 68,520 financing contracts worth SAR31.381bn, compared with about 20,000 contracts worth SAR12.746bn during the same period of last year 2018, achieving a growth rate exceeding 242% in the number of contracts and about 146% in the volume of financing compared to the same period in 2018.

The report added that the increase in the number of financing contracts exceeded 7,000 financing contracts. In June 2018, 1,835 contracts were signed against 9,711 contracts in June 2019. The volume of real estate finance in last June increased by more than SAR3bn riyals compared to the total financing in June 2018, which did not exceed SAR1.066bn, compared with about SAR4.4bn in June 2019.

Saudi Mortgages for individuals jump to 429% in 2019
Saudi Mortgages for individuals jump to 429% in 2019

Approximately 93% of the value of mortgage contracts offered to individuals in June 2019 were concluded through commercial banks, while 7% of them were contracted through mortgage finance companies in Saudi Arabia.

The report pointed out that the number of contracts for housing units subsidized through government housing programs in June 2019 by mortgage financiers from banks and finance companies amounted to 8,332 contracts, representing over 86% of the total contracts submitted, with a total value of SAR3.6bn, about 82% of the total value of financing contracts concluded during June 2019.

In its previous reports this year, SAMA indicated that mortgages had jumped more than three times as much as last year. The total number of mortgage contracts offered to individuals in January was 9,578, compared with 2,674 in January 2018, 9,736 financing contracts in February 2019 against 3,143 contracts in February 2018, and 12,148 financing contracts in March 2019 against 3,973 in the same month last year.

Saudi Mortgages for individuals jump to 429% in 2019
Saudi Mortgages for individuals jump to 429% in 2019

In April, it recorded 14,398 financing contracts with a total value exceeding SAR6.4bn, which was the highest in the history of Saudi banks compared to 4,286 contracts in April 2018. In May, 12,949 contracts worth SAR5.6bn were signed. The total number of mortgage contracts offered to individuals by the end of 2018 amounted to about 50,496 contracts with a total value of about SAR29.5bn, and in 2017 about 30,833 contracts valued at SAR21,025bn, while in 2016, about 22,259 financing contracts worth SAR17,096bn were signed.