Interview: Mohammed bin Saleh Albuty, CEO, National Housing Company
What role do environmentally sustainable building designs play in urban community development?
MOHAMMED BIN SALEH ALBUTY: Sustainability requires a comprehensive approach that influences the entire value chain. It is necessary to consider the key elements of sustainability, which include economic, social and environmental dimensions. For example, using solar panels, recyclable materials and efficient waste management practices is widely recognised as important. However, going beyond these aspects, environmental standards along with their social and economic counterparts are pivotal in shaping urban development. An essential consideration in planning is the creation of walkable, accessible communities, minimising residents’ reliance on personal vehicles and promoting sustainable modes of transport. This, in turn, not only reduces environmental impact, but also enhances social well-being.
Moreover, this approach fosters social responsibility within the community, strengthening bonds between residents and improving urban development. In Saudi Arabia, as in many parts of the world, this holistic view is becoming increasingly central to real estate investment and urban community development.
In what ways is the real estate market adapting to Saudi Arabia’s changing demographics?
ALBUTY: The real estate market is undergoing a significant transformation in response to shifting demographics. As the younger generation becomes a dominant force in the market, developers and investors are proactively adapting to address their evolving needs and preferences in terms of design and amenities. To shape this landscape, developers need to shift from generic housing solutions towards more tailored approaches that cater to the needs of this audience. Their priorities differ, and developers need to design living spaces that align with their lifestyles.
One notable shift is the focus on cost-effectiveness, with the aim being to minimise the initial capital expenditure for customers. This approach makes housing more accessible and also provides long-term value. There is a strong emphasis on creating more communal and public spaces within new developments to encourage social interaction, enhance the sense of community and provide an enjoyable environment for residents.
To what extent can the real estate sector contribute to job creation and the development of the Kingdom’s professional knowledge base?
ALBUTY: The sector plays a pivotal role in nurturing the Kingdom’s skilled workforce, covering a comprehensive value chain from planning and land development to construction and management. Opportunities for job creation arise at each stage, benefiting a diverse range of professionals and fostering local business growth. During this period, NHC contributed to the creation of over 600,000 jobs and generated more than SR85bn ($23bn) in GDP, according to an Oxford Economics study. By 2025 NHC, with its partners, is set to create 233,000 jobs, contributing over SR30bn ($8bn) to the GDP, representing 9% of the construction sector.
Which measures can address the financing challenges of high interest rates to improve the mortgage market and increase accessibility?
ALBUTY: Overcoming the challenges of high interest rates, especially for first-time buyers, requires strategic measures. We need solutions that are both innovative and adaptable. Re-evaluating product offerings to reduce overall costs and exploring new financing models can benefit customers and developers, providing balanced support for first-time buyers.
For developers, ensuring the feasibility of projects through pre-sales can help reduce their reliance on loans. Leveraging cash flows from buyers, as well as contributions from developers, can play a role in minimising borrowing needs, which in turn can ease the financial burdens of high interest rates on homeowners.
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