Gulf Cooperation Council (GCC) countries are doubling their efforts to further enhance low- and middle-income households’ ability to own affordable housing, as part of government efforts to address rapid urbanization and population growth.
A new report titled “New Trends in Affordable Housing in GCC”, released by Orient Planet Research of Orient Planet Group, discussed the latest trends and achievements of Gulf countries in narrowing down the demand-supply gap in the housing sector.
The region’s growing population is among the key drivers for rising demand, with young workers, whether citizens or residents, taking interest to acquire homes within their income reach.
The population increased by more than 50 percent over the last decade as shown by the figures released by “The Economist”. It is expected to reach 53 million in 2020, thereby putting an even greater pressure on the low-end segment of the housing sector.
Managing Director of Orient Planet Group Nidal Abou Zaki indicated a significant shift in affordable housing in the GCC.
He noted that governments and private developers are increasingly recognizing the demand for affordable housing in the region and various policies and schemes have been established to achieve this goal.
“However, there remains a need for identifying the market segment in terms of income class to enable developers to create value products and meet target markets.”
The report underscores the need to follow a comprehensive methodology in order to build better communities in the Gulf.
For instance, UAE’s housing policy has traditionally been focused on providing housing benefits and facilities to low income citizens through the federal and local governments.
The country’s “Sheikh Zayed Housing Programme” established in 1999, has an existing budget allocation of $1.36 billion to assist the housing needs of citizens, especially orphans, widows, aged citizens and people with determination.
Other GCC states are also taking bold moves such as Saudi Arabia with plans to construct one million housing units on top of the existing ones in line with Vision 2030.
Kuwait allocated more funds for the construction of an additional 45,000 housing units as part of its five-year plan which aims to fix the housing problem in the next three to five years.
Similarly, Oman has allocated OMR90 million for its housing projects as stated in the budget of fiscal year 2019.
Meanwhile, Bahrain widely invests in various social housing schemes, and has provided more than 36,000 support services to citizens through houses and flats, housing loans, and flats in subsidized rental and residential plots.
The report explains that in order to improve the gap in the market, housing experts note the importance of reinforcing public-private partnerships, focusing on resolving lack of credit and mortgage facilities, and initiating more social housing finance schemes.
In addition to the allocation of funds, Orient Planet points that the focus can also be on project management, proper framing of eligibility criteria, protection of housing standards, and partnerships with private agencies for efficient maintenance of public housing communities.
