The Saudi government has embarked on a major plan to build 7,000 new villas at an investment of SR4.48 billion ($1.19 billion) on a 6.5-million-sq-m area in the eastern part of Riyadh, said a report.

The project, called "East Gate", is the first being implemented by the Ministry of Housing in collaboration with the private sector, to tackle the shortage of affordable homes for its citizens, reported Arab News.

The villas, each of which costs SR640,000 ($170,578), will boast a total area of 316 sq m.

The project, which will come up near the premises of the Ministry of Interior in Riyadh, is being managed by an American firm, said the report, citing Saudi-based Hamad and Ahmed Mohammed Al Muzaini Real Estate.

Hamad Muzaini, board chairman of the real estate firm, said that the sale of the villas will start soon after Eid Al Fitr.

"The villas have different engineering as well as external and internal designs. These are available depending on the buyer's preferences and the financial capacity to pay," he added.

According to him, the buyers will have access to credit facilities in the kingdom such as the Real Estate Development Fund (REDF), which allows funding of up to SR500,000 ($133,264).

"The REDF was established by the Saudi government in 1974 to meet the need of the citizens by helping raise the quality of life in society through the development of quality housing," he added.