(MENAFN - Arab News) Riyadh, with SR99 billion real estate transactions, has ranked as the most sought-after city in the Kingdom. The capital city outweighs Jeddah, which had recorded more than SR90 billion of real estate transactions as per the real estate index issued by the Ministry of Justice.
The real estate sector has revealed the positive impact of the economic and social stability experienced across the Kingdom as per the Ministry of Justice index. The index closed at a value of SR99 billion of commercial and residential deals for the year 1434H in Riyadh, surpassing last year's deals that registered SR87 billion.
The index recorded more than 43,476 real estate deals in Riyadh city covering a total area of 227m2, with SR47 billion commercial transactions and more than SR51 billion residential transactions. This reflects the need toward seeking large locations to develop residential units to meet the increasing demand in the market.
Jeddah comes second with more than SR50.6 billion of residential transactions and SR39.9 billion commercial transactions, which represent 40,132 deals and over 90m2 of real estate area.
Majed Al-Hogail, MD, RAFAL, described as the premier residential communities innovator, said: "The economic and real estate cycle is moving rapidly and positively, and the demand on innovative residential units is increasing, which urges the real estate developers and investors to work on providing innovative residential solutions."
Al-Hogail added: "We at RAFAL are investing in new strategic locations and the innovation of more than,950 residential units over the next 5 years with cost of over SR5.1 billion. Our growth strategy covers the Kingdom with new and bold opportunities within a prosperous real estate investment in the Kingdom."
To facilitate the ownership of housing units by the citizens, more mortgage companies will be launched in 2014, as the Saudi government is working on activating the mortgage systems as per the enacted mortgage laws and regulations, to work alongside local banks and related governmental sectors, such as the Real Estate Development Fund and the residential units provided by Ministry of Housing.
The first half of the year 1434H has witnessed more than 70 percent of real estate deals, which indicates the investors' activity who conducted SR62 billion of real estate deals in Riyadh city alone.
Al-Hogail said: "RAFAL leads the dynamic lifestyle pattern that requires an enriched, homogeneous social environment, as well as common facilities adhering to environmentally friendly and safety principles to create vibrant residential hubs, self-sustained communities, desired by many Saudi and expatriate families."
According to Al-Hogail, the challenge facing the real estate market in the Kingdom is interesting, where the demand is increasing at an annual rate of 8 percent and is expected to last for a minimum of 10 years.
"This requires a consistency between the way of business and the regulations and challenges faced by the sector. Therefore, the performance has to be distinguished in order to be among the leading real estate development companies."