Riyadh – Mubasher: Saudi Arabian Monetary Agency (SAMA) increased the maximum loan-to-value (LTV) ratio from 70% to 85% of the value of the first housing unit, so that will be limited to citizens.
After more than a year since the implementation of finance laws and their implementing regulations, it had been recognized that real estate finance companies are better positioned bear the risks of real estate finance and adapting to the challenges associated with the nature of the sector, according to a statement published on SAMA's website.
In March, SAMA decided to raise the maximum LTV ratio, specified in Article (12) of the Implementing Regulation of the Real Estate Finance Law, from 70% to 85% for real estate finance companies only
The agency reasoned the move to that it will support growth in the real estate finance sector and increase competition among companies to provide more services at competitive prices and higher quality to serve citizens and meet market needs, without compromising the soundness and stability of the real estate finance sector, a statement said.
