Categorized | International

Potential homeowners in Saudi Arabia irritated by lending conditions

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Those looking to buy a home in Saudi Arabia have demonstrated feelings of frustration over the policies regarding the disbursement of housing loans. Several significant Arab newspapers, including Al-Jazirah, are reporting that the current loan conditions in place are undeniably absurd, and downright impossible considering the current climate of skyrocketing real estate and housing unit prices.

Although many Saudi realtors have seen some benefit greatly from housing loans, the tremendous demand surrounding real estate has lead to these success stories being an exception as opposed to a common occurrence.

Some are calling for the government to put even more money into housing loans as a corrective measure. However, realtors do not believe that such an increase will improve the situation. It is believed that both developers and investors are exploiting the current high-demand situation in the real estate market by asking for high prices on even the smallest of housing units. Thus, they will likely charge even more if loans were to increase any further.

The current climate of high prices has made it impossible for most loan beneficiaries to find a housing unit that meets their lending conditions. Depending on the value of the loan, beneficiaries are required to purchase a housing unit of a certain size. With the exorbitant prices and stringent lending conditions, most beneficiaries are fed up with the process, and are demanding a change.

One potential solution proposed by realtors is to build low-cost housing units with prices fixed according to the loan amounts set by the government. These housing units would primarily target those with lower income.

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About Nancy Raven

Nancy is the main writer for the International section of the website. Sometimes she also helps Drew out on the Finance/Mortgage section as well.

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