The real estate markets in the major cities of KSA (Jeddah and Riyadh) continued to drop during the second quarter of this year, according to a new report issued by JLL.
Q2 2016 Riyadh and Jeddah Real Estate Overview report said rents and sales prices in Jeddah and Riyadh have declined during the last quarter as low oil prices soften demand.
The pace of demand growth in both cities is slowing since sales volume dropped a further 5 percent last quarter.
Jeddah witnessed a number of delays in delivering residential projects despite the increased efforts taken by the government to solve the shortage of housing units, according to JLL’s report.
Riyadh is poised for a swell in houses supply as the total stock of residential units hit 1 million units. Jeddah, on the other hand, is seeing a stagnation in supply growth in comparison with last quarter.
The report mentioned also that increasing the loan-to-value ratio will spur more demand on residential properties.
The application of the White Land Tax will have a hand in lowering properties’ prices and upping the pace of construction, especially in the major cities.