Property prices in the Kingdom of Saudi Arabia rose this year, boosted by an increase in lending by private banks and government funds.
According to a Banque Saudi Fransi survey, the average price of residential land across Saudi Arabia rose to 1,631 riyals (S$537) psm, up 13.5 percent from 30 June 2010 and 4.8 percent from 31 December 2010.
The bank said that residential land plots are now more expensive than in the second half of 2008, before the global financial crisis. They are also becoming less affordable, as many of the citizens earn below 8,000 riyals per month.
The Saudi government has already increased lending through the Real Estate Development Fund, which provides interest-free loans of up to 81 percent.
In addition, around 40 billion riyals have been released into the fund this year to reduce the waiting period for loans.
Banque Saudi Fransi added that Saudi Arabian banks had 23.1 billion riyals of outstanding property loans at end-2010, an increase of nearly 30 percent from the previous year.
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