(MENAFN- Saudi Press Agency)
Riyadh, Muharram 29, 1439, October 19, 2017, SPA -- The Public Investment Fund (PIF) has announced the establishment of the Saudi Real Estate Refinance Company (SRC), in line with Vision 2030 objectives to improve the performance of the real estate market, increase its contribution to GDP, and raise the rate of homeownership among Saudis to 52% by the end of 2020. Demand for real estate financing in the Kingdom is expected to increase from SAR 280 billion in 2017 to SAR 500 billion in 2026.
Launched in partnership with the Ministry of Housing, and under the chairmanship of the Minister of Housing Majed al-Hoqail, the new company is designed to stimulate housing sector development in the Kingdom by injecting liquidity in the real estate market. SRC is anticipated to refinance up to SAR 75 billion for the Kingdom's housing sector over the next five years, reaching SAR 170 billion by 2026.
The company will act as an intermediary access point for investors, aligning the liquidity, capital, and risk management requirements of real estate mortgage companies, with the risk acceptability and return on equity to meet investor targets. It endeavours to create stability and growth in the Kingdom's housing sector by injecting liquidity into the secondary mortgage market, improving standards, and facilitating access to local and international financing sources.
SRC will adopt a strategy of acquiring mortgage funds to increase financial capabilities and broaden the activities of real estate financing companies. It will also work on linking the investment capital of foreign and local investors with the range of opportunities available in the Kingdom's growing housing market.
In addition, the company's activities will include issuing bonds as securities, supported through real estate mortgage contracts over the short and long term, to real estate financing companies.
SRC is considered a leading new initiative for the Kingdom's housing sector, launched in line with the highest international standards. SRC has been granted a licence to undertake real estate refinancing activities by the Saudi Arabian Monetary Authority (SAMA).
--SPA
14:39 LOCAL TIME 11:39 GMT
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