The central bank of Saudi Arabia will allow mortgage providers to fund greater share of their customers’ house purchases.
The contribution will be raised from 70 percent of the value of the house to 85 percent of the value of the house.
The decision is a part of an integrated plan adopted by the Saudi authorities to address the housing crisis in the Kingdom. The government aims at making house financing affordable for all citizens to facilitate house ownership.
Mortgage providers are deemed capable of taking the risk of the change, according to the bank.
Last December, the central bank approved establishing a new national home finance company “Bidaya” and it approved the affordable mortgage program in February that accepts only 15% of the house value as a deposit.