SRC plans acquiring SAR 50 bln lending portfolios

Saudi Real Estate Refinance Co. (SRC) is planning to purchase real estate lending portfolios worth SAR 50 billion over the next two years, the company’s chief executive Fabrice Susini told Al Eqtisadiah newspaper.

The step aims to pump more liquidity into the Saudi real estate financing market and enable a wider range of citizens to own houses.

The company plans to acquire a 10 percent share of the financing sector over the next two years, eventually boosting its market share to 20 percent by 2026, Susini said.

Purchases will only be limited to portfolios from Saudi-based financing institutions, Susini added, without disclosing the number of target portfolios.

Last week, SRC launched the first tranche of long-term, fixed rate mortgage loans for citizens through various financial institutions across the Kingdom. The financing options are available to all Saudi citizens who are eligible to avail of loans,

Providing customers with fixed-rate loans protects them against the volatility of interest rates, Susini recently told Al Arabiya channel.

SRC provides loans through its network of financial institutions, and it aims to increase and diversify its mortgage services for borrowers, he said.

The company was launched last year by Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF) as part of plans to boost Saudi home ownership.

Saudi Arabia plans to raise the rate of home ownership among citizens from 47 percent to 52 percent by 2020, and 70 percent by 2030, as part of wider economic reforms in the Kingdom. 

SRC, which works under the auspices of the Ministry of Housing, expects to refinance up to $20 billion over the next five years, a move targeted to remedy the nation’s low mortgage penetration rate, Susini said in December.