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Property prices drowning

Property prices drowning

Property prices of areas in east Jeddah hit by floods in November last year have dropped drastically, says Arab News. But there are still no buyers.

January 4, 2010 2:33 by

Hamad al-Mitairi, who owns a real estate agency, said buyers now prefer homes and land in the north of the city away from flood-prone areas. “The prices are high in areas that are at an elevation and where the chances of inundation in the event of rains are low. On the other hand, prices are down in low-lying areas,” he said.

Al-Mitairi believes property sales in flood-affected areas are likely to be on hold until all related issues are resolved. “Once these are sorted out, it would be possible to restructure the areas and make them attractive to prospective buyers,” he said.

Abdullah al-Ahmari, a real estate evaluator at the Jeddah Chamber of Commerce and Industry, attributed the high price of real estate in the city to a number of reasons, including speculation, new projects and opportunistic investors who inflate prices after tragedies. He added that prices have increased in the north of the city due to residents of the city’s eastern districts opting to leave and move north.

Khalifa Abbat Allah, a Saudi, said he owns a piece of land in Al-Riyadh district that he bought a few years ago for SR60,000 ($16,000). “As many people now want to leave the eastern district for areas where floods are less likely, I was offered SR200,000 ($53,300) for this piece of land but I’m still looking for a better price,” he said.

First seen in Arab News.

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