(MENAFN - Arab News) The Committee of Economic Affairs and Energy at the Shoura Council faced vehement opposition from several members when the council announced its recommendations to allow foreign investors to own properties within Makkah and Madinah's borders.
A member of the Shoura Council said that the committee has long since prevented foreigners from buying properties within the vicinity of the Two Holy Mosques, according to local media sources.
Members of the council claim that preventing foreign investment will maintain the religious identity of the two cities.
According to Saudi Arabia's foreign investment regulations, an expatriate licensed to engage in business activity is entitled to own a property either for residency purposes or for pursuing business objectives. Foreigners can also buy homes to accommodate employees. Expatriates, however, are not allowed to own properties in Makkah and Madinah
Abdullah Al-Ahmari, head of the real estate appraisal committee at the Jeddah Chamber of Commerce and Industry (JCCI), said in a previous interview that registering an expatriate's property under the name of a Saudi national is a clear violation of regulations in the country that could result in the confiscation of the property and a fine for all involved
However, expatriates with high incomes mostly buy real estate out of Saudi Arabia, particularly in their home countries, because they do not know if they will continue living in the Kingdom. heir deals to buy properties abroad are estimated at more than SR8 billion, mostly in Egypt, Dubai and Abu Dhabi.
Salem Radwan, manager of a real estate company in Jeddah, said members of the Indian community in Saudi Arabia own many homes in Dubai and Abu Dhabi. Many Sudanese nationals in the Kingdom own apartments in Cairo, he added
Talal Samarqandi, head of the JCCI's engineering office committee and former real estate committee member, said a foreigner wanting to own a property in Saudi Arabia had to meet stipulations such as having a good financial record and approval from the Ministry of Interior
He added: "There are a lot of foreigners who were born and raised here. This segment is particularly interested in owning the place they live in instead of continuing that can become a burden on their monthly incomes.
Chairman of JCCI's real estate committee Muhammad Al-Amir said foreigners in Saudi Arabia can own properties only if the profession listed on their residence permit is foreign investor. Priority for owning properties is given to Saudis, he added
Some real estate experts said there is a long way to go before expatriates will be allowed to buy properties given the supply and demand in the market
Al-Amir said supply was not meeting the growth in population in the Kingdom. Once supply and demand are balanced locally, he added, the circumstances would be adequate for issuing laws regulating expatriates' ownership of properties