Investment in property in Saudi Arabia by Pakistanis has increased by an estimated 25% over the last three years. This is primarily due to the fact that property (commercial or residential) there has proven to have a substantial ROI (return on investment). However, only Pakistanis who have a Saudi Residence Permit or an investment/business visa are allowed to purchase property in Saudi Arabia, and they can do so anywhere in the country with the exception of the holy cities of Mecca and Medina.
If you are thinking of investing in property in Saudia Arabia, factor in the following:
1.The cities where property is considered prime include Al-Khobar, Dammam, Jeddah, and Riyadh.
2.Residential property prices appreciate by 14 to 17% annually, while commercial property prices increase by 13 to 15%.
3.The estimated rental yields of residential and commercial property ranges between eight and 10% of the value of the property.
4.Saudi Residence Permit holders may purchase residential property (apartments, houses and vacant residential plots) for personal residences after obtaining approval from the Ministry of Interior or Council of Ministers.
5.investment/business visa holders may purchase commercial and residential property, for business or personal use, after obtaining permission from the General Investment Authority.
6.To establish a real estate business, a Real Estate Investment License is required from the General Investment Authority. The value of the property, including land and construction costs, should exceed SAR 30 million (Rs 807 million); construction has to be completed within five years form the date of purchase of the property.
The purchase price ranges of property in Saudi Arabia are:
*Plots
Residential plot sizes: 300, 500 and 700 square metres
Prices: Rs 40,000-150,000 per square metre
Commercial plot sizes: 100, 300 and 500 square metre
Prices: Rs 100,000-300,000 per square metre
*Apartments
Covered area: 130 and 190 square metres
Prices: Rs 60,000-200,000 per square metre
*Houses
Plot sizes: 300, 500 and 700 square metres
Prices: Rs 80,000-250,000 per square metre
*Shops and offices
Plot sizes: 100, 300 and 500 square metres
Prices: Rs 150,000-400,000 per square metre
By Syed Wajeeh-ul-Hassan Naqvi. Information provided by Masamah Arabia Est. and Colliers International, KSA.