General Housing Authority GHA – Housing Market Landscape Assessment Report Development of Business Model & Implementation Housing Regulation Project Control Sheet FINAL VERSION DATE Document GHA – Market Landscape Assessment Report Author/Owner Acceptance Status (Full, Partial or Conditional) Comments by approvers Name Position/Role Sign-off Date Signed TABLE OF CONTENTS 1 INTRODUCTION..............................................................................................................................................6 1.1 SNAPSHOT OF SAUDI ARABIA ......................................................................................................................7 1.2 ABOUT GHA .............................................................................................................................................10 1.3 THE HOUSING REALITY :............................................................................................................................12 1.4 HOUSING HISTORY IN SAUDI ARABIA ........................................................................................................14 1.5 HOUSING HISTORY FROM CITIZENS ’ PERCEPTION ......................................................................................16 1.6 DEVELOPERS ’ POINTS OF VIEWS ...............................................................................................................17 2 MACROECONOMIC STUDY AND TRENDS AND CORE HOUSING INDICATORS ........................21 2.1 MACROECONOMIC OVERVIEW ..................................................................................................................22 2.2 DEVELOPMENT OF ECONOMIC CITIES ........................................................................................................23 2.3 INFLATION AND INTEREST RATES ..............................................................................................................24 2.4 BUDGET .....................................................................................................................................................24 2.5 WORKFORCE .............................................................................................................................................24 2.6 MACROECONOMIC & DEMOGRAPHIC ........................................................................................................26 2.7 HOUSING MARKET INDICATORS ................................................................................................................27 2.8 CONCLUSION .............................................................................................................................................30 3 CURRENT GOVERNMENT SOCIAL/AFFORDABLE HOUSING POLICY .........................................31 3.1 AFFORDABLE HOUSING & SOCIAL HOUSING : ............................................................................................31 3.2 CURRENT STATUS .....................................................................................................................................32 3.3 DESCRIPTION & PROFILE OF SOCIAL /A FFORDABLE HOUSING PROGRAMS .................................................33 3.4 DESCRIPTION & PROFILE OF SOCIAL /A FFORDABLE HOUSING PROGRAMS BENEFICIARIES .........................33 3.5 GENERAL FUNDING ARRANGEMENTS ........................................................................................................35 3.6 CONCLUSION AND LESSONS LEARNED ......................................................................................................35 4 HOUSING STAKEHOLDERS.......................................................................................................................36 4.1 STAKEHOLDERS ’ DEFINITION : ...................................................................................................................36 4.2 STAKEHOLDERS ’ GROUP : ..........................................................................................................................36 4.3 STAKEHOLDERS ’ HIGH LEVEL DESCRIPTION & THEIR CURRENT ROLE .....................................................37 4.4 GOVERNMENTAL BODIES ..........................................................................................................................38 4.5 PUBLIC AGENCIES .....................................................................................................................................41 4.6 THE PRIVATE SECTOR ...............................................................................................................................42 4.7 CHARITY & NON -PROFIT ORGANIZATIONS ................................................................................................43 4.8 STAGES OF BUILDING STAKEHOLDER COMMITMENT .................................................................................44 5 HOUSING DEMAND – DEMOGRAPHIC AND SOCIO ECONOMIC INFLUENCES (CURRENT AND EXPECTED).....................................................................................................................................................45 5.1 DEMAND ANALYSIS ...................................................................................................................................46 5.2 HOUSING CHARACTERISTICS : ....................................................................................................................50 5.3 URBAN AGGLOMERATIONS ........................................................................................................................51 5.4 IMPORTANT METROS FOR FUTURE DEVELOPMENT ....................................................................................51 5.5 HOUSING SHORTAGE .................................................................................................................................53 5.6 MAIN PROVINCES ......................................................................................................................................54 5.7 PEOPLE PREFERENCES TO HOUSING ..........................................................................................................55 5.8 HOUSING PREFERENCE BY AGE .................................................................................................................56 5.9 HOUSING PREFERENCE BY LEVEL OF EDUCATION .....................................................................................56 5.10 HOUSING PREFERENCE BY INCOME ...........................................................................................................56 General Housing Authority Page 3 BM & IR Project 5.11 HOUSING PREFERENCE BY GEOGRAPHIC LOCATION ..................................................................................57 5.12 SUMMARY OF DEMAND ESTIMATES ..........................................................................................................58 6 HOUSING SUPPLY AND DEVELOPMENT (CURRENT AND EXPECTED)........................................61 6.1 QUALITY OF HOUSING ...............................................................................................................................67 6.2 SAUDI ARABIA ’S BUILDING CODES ............................................................................................................67 6.3 HOUSING CONDITIONS ...............................................................................................................................69 6.4 NEW HOUSING SUPPLY & PLANS ...............................................................................................................70 6.5 LAND AVAILABILITY & PRICES ..................................................................................................................74 6.6 CONSTRUCTION RELATED COST ................................................................................................................75 6.7 VOLUME OF HOUSING CONSTRUCTION .......................................................................................................76 6.8 HOUSING MARKET SUPPLIERS ...................................................................................................................78 6.9 CHARITY & NON -PROFIT ORGANIZATIONS SECTOR ...................................................................................79 6.10 RESALE (SECONDARY ) HOUSING MARKET ................................................................................................83 6.11 RENTAL HOUSING MARKET .......................................................................................................................84 6.12 ROLE OF REALTORS /B ROKERS ...................................................................................................................84 6.13 ROLE OF APPRAISERS ................................................................................................................................85 6.14 SUMMARY OF CHALLENGES & GAPS .........................................................................................................85 6.15 CONCLUSION .............................................................................................................................................86 7 HOUSING AFFORDABILITY ANALYSIS..................................................................................................88 7.1 AFFORDABILITY ANALYSIS IN EFFECTIVE DEMAND ...................................................................................91 7.2 SUMMARY OF CHALLENGES & GAPS .........................................................................................................93