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JEDDAH: About 4,000 new residential units entered the Riyadh property market in the fourth quarter of 2016 and a further 25,000 units are expected to be built this year, according to report from JLL.
JLL is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate.
The government took several initiatives to work with the private sector in 2016 in an effort to increase housing supply in ��������Ƶ, the real estate consultancy said in its report — “2016 Year in Review.”
“The government’s major plans to energize the real estate market have resulted in a more positive outlook for 2017 in line with measures to counteract reduced government and consumer spending,” said Jamil Ghaznawi, country head of JLL, ��������Ƶ. 
 In an effort to diversify the economy and open the real estate market to smaller investors, the Capital Market Authority introduced new rules in 2016 allowing the formation of the Real Estate Investment Traded Funds (REITs) on the local stock exchange.
 “The market is optimistic that by introducing REITs, the National Transformation Program’s (NTP) goal to increase real estate contribution to GDP from 5 percent to 10 percent annually will be achieved in addition to creating more transparency in the market,” he said.
 “In addition, these funds could help provide an exit strategy for those developers seeking to create income producing assets rather than developments for sale” commented Jamil Ghaznawi.  
The report also highlights 2016 as an active year for white land tax and home financing which both have implications for the real estate market in 2017 as the changes start to come into effect. 
It said year-on-year rental values for villas and apartments in the Saudi capital fell by 4 percent during the past 12 months, but added that residential performances remained relatively stable in Q4.
In Jeddah, although there were limited notable completions in 2016, the projects which did complete were part of a growing concept of quality lifestyle developments, JLL said.
Around 4,000 units were added to the Riyadh market over the last quarter, with the first half of 2017 expected to see a number of developments enter the market which were delayed from 2016, it added.