‘Miracle’ needed to revive real estate sector — investors

AMMAN — The housing development sector’s trade volume dropped 32 per cent in November compared to the same month in 2017, according to statistics from the Department of Land and Survey.

The estimated loss stands at JD387 million, which is a further 46 per cent decrease since November 2016. 

“The statistics conclude that the sector has been facing a continuing decline over the past three years,” said Zuhair Omari, president of the Jordan Housing Developers Association (JHDA).

According to Omari, several factors are at play in the continued difficulties of the sector.

“The price of land, both in the capital and the governorates, has skyrocketed, sometimes ranging from 30 to 50 times that of the last 30 years,” said JHDA’s president.

Multiple increases in the price of building materials and construction worker’s wages are also contributing factors, according to several stakeholders.

“Between my workers’ wages, the cost of transport to and from the site, the cost of building materials and licensing fees, we barely break even with each building or house we build,” said Saeb Led, a housing developer.

Suad Abu Ruz, an engineer-turned-housing investor, told The Jordan Times she has refrained from building and buying this year, as she “still hasn’t made profit from the ones built in 2017”.

Banks’ interest rates for housing loans are another source of frustration for those in the sector, according to Omari.

“Interest rates on housing loans have increased five times this year,” he pointed out.

The real estate sector took several hits this year, one of which was the withdrawal of over JD400 million worth of investments. However, a recent decision by the Prime Ministry to allow Gazans to own real estate raised hopes of reviving the sector.

“If the sector is not saved by a miracle next year, it will collapse and take us [stakeholders] with it,” warned Led.