Rising costs threaten Saudi real-estate market

Crisis in Syria halting the import of Turkish building materials overland routes

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RELATED ARTICLES: Saudi projects value dips ; Kuwait, Bahrain move up | Five-day week debate continues in Saudi Arabia | KSA firms plan ‘labour renting scheme’ to resolve building crisis A new crisis is set to threaten the Saudi real-estate market, with obstacles cropping up when it comes to local contractors importing building materials, especially from Turkey. An Arab News report stated that this comes at a time when the Saudi Ministry of Housing plans to build around 40,000 homes and 500,000 low-cost homes to solve the Kingdom’s housing problem. Contractors said building material prices have increased by 20 percent, and the importing of iron from Turkey to the Kingdom by land is facing many transportation obstacles as Syrian authorities currently do not allow the crossing of Turkish trucks. Iron factories wishing to increase their productivity also face problems importing essential material for their operations, the report added. Abdullah Mussaed, a general manger at a building materials company in Dammam, said: “Transportation by sea is very expensive. Most building material companies and factories in the Kingdom prefer to transport material by land. However, there are many difficulties in importing building material from Turkey by land.” “The high prices of construction material are not limited to the Saudi market alone. There is a global phenomenon of high shipping prices. There are consumers demanding that the Ministry of Trade and Industry intervene for controlling rising prices”, he added. According to local media reports, the price of construction has increased from SR95 to SR130 per meter, and the price of building materials has increased by 10 to 20 percent due to a high number of construction projects in the Kingdom. Saleh Al-Said, a member in the Real Estate Committee of the Eastern Province Chamber for Commerce and Industry, said: “the high prices of construction material are an indication that traders in the Saudi market need to build smart houses.” “There is an increase in demand and a lack of supply of housing units due to the high prices of building material in the summer, and fears that the prices of units will increase further”, he added.


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