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The Saudi housing crisis can be solved with cheap units, less bureaucracy and innovative financing, said Deputy Premier of Turkey Ali Babacan at the Jeddah Economic Forum (JEF) yesterday.
Babacan said his government granted free plots and built six million units to solve the housing crisis in Turkey.
Babacan stressed the need to cut lengthy bureaucratic procedures.
“My country succeeded over the past 10 years in implementing a national project to establish integrated residential districts which accounted for 10 percent of all housing projects. It also fulfilled the housing needs of the people and eradicated slums and unplanned neighborhoods,” the Turkish minister said.
“We realized that simplifying procedures to obtain housing plots was the cornerstone of solving the housing problem,” he said.
The system also evolved a two-pronged approach by adopting a community housing scheme and undertaking another for profitable housing projects.
He said the private sector undertook the projects. The projects also included the construction of 900,000 schools and 100,000 health care centers because all housing facilities need other utilities and infrastructure.
Funding solutions included the issue of treasury bonds, legalization of bond issues by the private sector, launching investment funds and the revitalization of the mortgage sector, he said.
People of limited income and middle income groups needed to pay only 25 percent of the cost of a unit initially with the remaining amount paid in installments, he said.
The deputy premier said developing nations have to solve their housing problems because discontent could erupt into uncontrollable situations.
In her address to the forum on the role of governments in the second session on the second day of the JEF, Ireland’s Minister for Housing and Planning Jan O’Sullivan briefly outlined the success story of how her country tackled its housing crisis with the establishment of housing cooperatives.
While people need only pay 25 percent of the construction cost of affordable houses, the private sector and some other agencies pay the remaining portion as part of their corporate social responsibility, O’Sullivan said.
It was the responsibility of the state to provide the land for housing, she said. With easy access to financing the country has been experiencing a housing and property boom. Her government is striving to revitalize the economy by providing more employment and housing opportunities at affordable prices. She added that while most people dream of owning their own homes some people do not repay the loans taken from financing institutions.
Chairman of the Board of Trustees and President of the Arab Urban Development Institute Abdullah Al-Naeem said that the Kingdom’s housing sector made a qualitative shift with Custodian of the Two Holy Mosques King Abdullah’s order to allocate SR 250 million to build 500,000 housing units. He added that the government allocated 2.5 million land grants for housing in the past. In Riyadh alone 40 million sq meters of land was granted to limited income families, he said.