Saudi Minister of Housing Majed al-Hogail announced that authorities were considering the full exemption of VAT on Saudi citizens’ first residence.
He pointed out that the first residence, which valued at around SAR850,000 ($227,000), is exempt from the 15 percent tax.
He also expected a minimum of 550,000 subsidized loans during the upcoming five year-period.
The ministry is currently working on establishing a “guarantee” company to overcome challenges facing the finance sector, he further noted during a virtual meeting, which was organized by the Eastern Chamber of Commerce and Industry and attended by a number of real estate developers on Tuesday.
Since early 2020, more than 105,000 citizens have obtained financing loans, Hogail noted, adding that the value of housing units is estimated at about SAR245 billion ($65.3 billion).
He stressed the importance of the real estate developers who are able to find housing communities that include amenities, such as housing units with gardens, coffee shops and all what families need in order to raise the quality of life within these units.
“There are more than 70 real estate developers working in 100,000 currently constructed housing units,” he added, pointing out that the ministry seeks building between 180 and 200,000 housing units before the end of 2020.
Regarding the rate of delinquency, Hogail stated that it is less than 0.5 percent, which is very low.
“This indicates that Saudi citizens are committed to loans, which helped us reduce funding, thus enhancing the purchasing power.”
