Saudi Arabia-based Red Sea Housing Services Company (RSH) said it has reached a strategic alliance with Direcional Engenharia, a Brazilian developer, to provide affordable housing solutions for the kingdom's rapidly expanding population.

The agreement comes at a time when Saudi Arabia's real estate and construction sectors are witnessing a boom, driven by the rising demand for homes for local residents, said a statement from RSH.

As per official data, the kingdom will need nearly 1.25 million residential homes by 2018 to keep pace with its growing population, which is expected to hit 37.2 million by 2020.

To ensure adequate supply, the Saudi Ministry of Housing has adopted an ambitious target to build 500,000 affordable homes for Saudis, which has recently entered the implementation phase, it stated.

The global housing sector was estimated to be valued at $800 billion in 2014 - offering home builders with market opportunities especially in the Middle East.

The deal with Barazilian group complements Red Sea Housing's vision of providing affordable housing solutions for Saudi Arabia's rapidly expanding population, said a senior official.

"We look forward to working closely with "Direcional Engenharia" to deliver affordable residential homes of unmatched value, quality and scale," stated Joseph Vecchiolla, the chief executive and managing director of RSH.

"We are very optimistic as it combines Red Sea's vast knowledge, its local and global experience with Direcional's expertise of developing high quality affordable communities for Saudi families," he added.

Direcional Engenharia is a leading publicly listed company in Brazil that has built a reputation for delivering affordable homes under the country's unique 'Minha Casa, Minha Vida' (My House, My Life) program.

In 2014, Direcional delivered an average of 1,540 homes per month to meet the needs of families throughout Brazil.

Ricardo Ribeiro Valadares Gontijo, the managing director of Direcional Engenharia, said Saudi Arabia has emerged as a preferred destination for real estate investment within the GCC due to the large demand, particularly from the residential segment.

"We believe the need for affordable homes will grow at an unprecidented rate between 2015 through 2020 and beyond. In addition, we believe housing is one of GCC's most valuable market with estimated $495 billion worth of projects under various stages of construction," he noted.

"We are fully committed to working closely with Red Sea Housing which has long been known for its swift delivery of affordable housing solutions throughout Saudi Arabia and beyond," he added.-TradeArabia News Service