Saudi Real Estate Refinance Company (SRC), a unit of Public Investment Fund, has announced that the maturity offering of its long-term fixed rates - the benchmark for mortgage rates in the kingdom - has been extended to 30 years.
By extending the maximum eligibility tenor to 30 years from 25 years previously, SRC will further support the development of a robust mortgage market in the kingdom, providing longer term liquidity to primary originators.
According to SRC, it will allow lenders in the kingdom more flexibility and ability to offer more sustainable mortgage solutions to borrowers.
SRC pointed out that it does not directly engage with borrowers. However through this offering, they will benefit from lower monthly financial payments and the opportunity to increase the amount of the loan borrowed at a fixed rate over a longer period, it stated.
Furthermore, the action taken by SRC will contribute to maintaining the increased sector’s contribution to the national GDP and its diversification.
CEO Fabrice Susini said: "When we introduced the LTFR in 2018 with tenors from 10 to 25 years to all originators in the kingdom, we aimed to increasing the offer of fixed rate mortgages to borrowers and encouraging fair pricing."
"We initiated our drive to set a benchmark for long term fixed rate to stabilize the real estate sector in the kingdom and protect borrowers against interest rates volatility," observed Susini.
"With the extension of the LTFR offering from 26 years to up to 30 years maximum tenor, we are continuing to demonstrate our commitment to supporting Saudi borrowers with an attractive solution focusing on stability and affordability in a very challenging environment," he added.-TradeArabia News Service