Saudi Arabia needs to invest a more than $180 billion in the real estate sector to meet expected demand for housing by 2015, it has been revealed.

A report by local investment bank NCB Capital found Saudi’s booming population – with 70 percent below the age of 30 – was creating an “acute” housing problem for the kingdom.

It forecast incremental residential demand of more than 1.3 million units over the next seven years.

It said investment in excess of 680bn riyals ($181.3bn) would be required to meet that demand.

The top four provinces of Makkah, Riyadh, Madinah and the Eastern Province by themselves would require a housing investment of over 600bn riyals over the period, it said.

In light of the need for housing, the report said the outlook for companies in the real estate and allied sectors was bullish.

It predicted residential and commercial real estate sales would soar in the coming years with the expected introduction of a mortgage law and the government investment in economic and industrial zones.

The upcoming mortgage law would improve housing affordability, driving more people to buy instead of rent, the report said.

It estimated the Saudi mortgage market would increase five-fold to 96.5bn riyals by 2012.

The retail sector, it was estimated, could exceed 130bn riyals in value. - TradeArabia News Service