Affordable housing in GCC: National policies and future needs

(Last of two parts)
In Part 1 of this article published yesterday, we looked at problems and challenges in the provision of affordable housing in GCC countries. In this article we turn our attention to the actions already being taken by governments and charitable institutions and look at further measures that needed to ensure that GCC populations have adequate housing.

National Housing Policies
With the growing population in the Gulf region and the shortage of affordable housing, the GCC countries are taking serious measures to improve the housing situation.
In Bahrain, in 2007, the Sheikh Khalifa bin Salman Al-Khalifa Habitat Award was established to promote the principles of good governance and equity in housing. The Bahraini government launched a series of regional and international conferences addressing housing issues, the most recent being the Middle-East Affordable Housing Development Summit in 2012. Amendments to the law on land and building regulations now allows the construction of additional houses on plots of land and the enlargement of small houses. A major reclamation project is Diar Al-Muharraq, supported by the government and launched by the private sector, a mix of residential and commercial properties with over 30,000 housing units. In January 2012, the government struck a deal with the private sector to deliver more than 4,000 homes for low-income citizens. Eskan Bank provides housing finance solutions for Bahraini citizens within the framework of the national economic vision.
Kuwait's Five Year Plan 2010-14 included a budget of $ 140 billion to meet the urgent need for housing. The plan targets the development of mega projects and numerous urban projects, the construction of residential units and the development of new satellite cities in different regions. One mega project is Silk City or Madinat Al-Hareer, an urban center with over 175,000 units. The Kuwait Public Authority for Housing Welfare, with the participation of the private sector, launched the Sabah Al-Ahmad Future City project providing 11,000 residential units including 9,000 housing units for Kuwaitis on welfare. Under a new law, the Kuwait Fund for Arab Economic Development has to contribute up to 25 percent of its net annual income to the Public Authority for Housing Assistance.
Oman's Five-Year Development Plan (2011-15) seeks to implement housing projects with a budget of $ 1.16 billion (8 percent of total planned spending). Sultan Qaboos ordered a grant of $ 520 million for the housing assistance program, which includes housing loan projects. New land laws were issued (May 2011) exempting lower-income nationals from fees or allowing a fee reduction, and government subsidies were distributed to them while the Ministry of Housing increased their housing loan. The Oman Affordable Housing Summit (June 2011) discussed the government's affordable housing policies and the First Oman Sustainable Urbanization Conference (September 2011) examined rapid urbanization and its impact on communities, economies and policies. The Oman Housing Bank contributes to the development of the housing sector by providing affordable housing and lending services for Omani adult nationals d with a fixed monthly income.
In Qatar, the Ministry of Civil Service Affairs and Housing has been providing since the mid-1960s affordable housing and furnishing allowances for Qatari citizens with limited income or special needs. In 2007, a general law granted Qatari citizens special facilities for housing loans and purchase of land. Recently, the ceiling for home loans was doubled to $ 330,000 for eligible nationals and repayment tenure was extended to 37 years. The Qatar Development Bank is the main institution responsible for providing government housing loans for citizens.
In Saudi Arabia, the government has been providing low-income nationals since the 1970s with free land-plot grants to build housing with interest-free loans. The Five Year Development Plan (2010-14) prioritized housing development as a central focus of its economic stimulus. The plan aims to increase supply through the construction of one million housing units (to meet 80 percent of the demand for housing) and to provide around 266 million square meters of land for housing projects. In 2011, Custodian of the Two Holy Mosques King Abdullah pledged more than $ 82 billion to fund housing projects in the country.
A new Ministry of Housing has been created with an initial budget allocation of $4 billion. In July 2012, a new Saudi mortgage law was approved to boost a new real estate finance market and to help Saudis to get finance in conformity with Shariah regulations. The new law covers mortgage registration, real estate funding, finance companies, financial leasing, and enforcement and has the potential to increase housing supply by as much as 50 percent. As well as acting as a catalyst for the domestic real estate sector, it will widen funding options for middle- and low-income nationals. The Real Estate Development Fund approved in June 2012 the release of 11,666 housing loans to construct 14,000 housing units in different parts of the country.
The High Commission for the Development of Riyadh through Arriyadh Development Authority established the Metropolitan Development Strategy for the city, planning for the increasing population over the next 50 years. It intends to create around Riyadh two suburban cities each housing 500,000 people and five smaller centers housing 1.25 million people to cope with its annual growth rate of 8 percent. The city of Jeddah allocated 25.5 million square meters of land for the construction of affordable houses in the city.
In the UAE, Sheikh Khalifa bin Zayed Al-Nahyan ordered the distribution of 800 residential plots to UAE nationals in Abu Dhabi, 400 new low-cost houses for citizens on Delma Island, and the delivery of 3,000 housing grants mostly as plots to be distributed to Abu Dhabi citizens. In Abu Dhabi, residential projects include the building of more than 7,608 villas for nationals and more than 23,000 residential units.
The Abu Dhabi Urban Planning Council declared that more than 50,000 homes would be built for Emiratis over the next 20 years. Most houses and plots are being given to citizens free of charge.
The Ministry of Public Works and Housing is active in providing housing for nationals as part of its policy to help local families and provides assistance in the form of loans/grants to nationals who own land and wish to build a home. It also offers interest-free long-term loans for those who can repay them.
The Sheikh Zayed Housing Program provides housing and services for eligible low-income UAE families, granting interest-free loans for buying, building, completing, expanding or maintaining a house, or providing a government house grant. By May 2012, the program had issued housing aid to 26,000 citizens from all emirates; 12,000 houses have been handed over so far, and work is under way on a further 14,000 houses.
The Mohammed Bin Rashid Housing Establishment grants Dubai nationals residential plots, affordable, purpose-built houses, and housing loans. It plans to build 10,000 residential units at a cost of $ 2.7 billion. Since 2007, more than 2,165 housing units have been completed under its plan to build 10,000 residential units.

The Role of Charitable Associations
GCC charitable associations have launched housing programs to help low-income nationals.
In Bahrain, the Royal Charity Organization established by King Hamad bin Issa Al-Khalifa contributes to setting up and developing centers for the elderly, orphans and disabled as well as providing plots of land for social and charitable projects.
In Oman, the Omani Charitable Organization provides welfare assistance nationally and internationally and provides housing services. The organization has constructed 2,010 rooms for nomads inhabiting remote areas and built complete lodging units. It also helped affected communities from tsunami disasters in regions of Oman by building affordable houses for more than 1,000 families.
In Qatar, the programs of both the Qatar Charitable Society and the Sheikh Eid bin Mohamad Al-Thani Charitable Association include the building of affordable houses.
In Saudi Arabia, the King Abdullah Foundation for His Parents for Development Housing seeks to improve Saudis' social, cultural, and living standards through affordable housing. The foundation inaugurated with King Saud University a Chair for Housing Development at the College of Architecture and Planning. The chair conducts scientific and practical research and studies on affordable housing that will lead to the implementation of housing projects for Saudi nationals.
The Prince Sultan bin Abdul Aziz Charitable Foundation provides affordable houses for poor Saudi families in different regions of the country. Nearly 1,250 housing units have been built or are under construction at a cost of $ 105 million.
The Prince Salman bin Abdul Aziz Charity Housing Project, as part of a wider program for poverty alleviation, provides housing for poor Saudis living in Riyadh whose total family income is less than $ 1,000. The project also includes homeless nationals, senior citizens, orphans, and people with special needs or suffering from drug problems. The society inaugurated the Prince Salman bin Abdul Aziz Chair for Charitable Housing with King Saud University.
The Alwaleed bin Talal Foundation for Charities and Humanitarian Assistance has the provision of affordable housing for low-income Saudis as one of its major objectives. In ten years, more than 1,200 housing units have been provided to Saudi families across the country. The foundation has also provided nearly 60 residential apartments in Riyadh for widows and those with special needs.
In the UAE, the Easa Al-Gurg Charity Foundation in Dubai builds residential projects for Emirati orphans and elderly. The Sheikh Khalifa bin Zayed Al-Nahyan Charity supports the restoration of houses in Abu Dhabi, Al-Ain, Al-Fujeira and Ras Al-Khaimah. For more than a decade, the Sheikh Mohammed bin Saud Housing Rehabilitation Program in Ras Al-Khaimah has been helping Emiratis to rebuild their homes with funding for around 1,000 houses.

Making Affordable Housing a National Priority
The right to adequate housing is internationally recognized as an important component of the basic human right to an adequate standard of living and the United Nations Housing Rights Program UN-HABITAT agenda states that "Governments should take appropriate action in order to promote, protect and ensure the full and progressive realization of the right to adequate housing." As we have seen GCC governments are making great strides to improve the housing situation in the region. They are investing their oil revenues not only in education but also in housing projects. However, it is vital that governments make affordable housing a national priority. They should take into consideration the rising aspirations of a growing young population and look for new ways to establish affordable housing projects.
A serious plan of action should involve the adoption of a national housing policy that integrates economic, social and cultural issues along with physical planning and development. The strategy should include solid measures to provide accommodation for future population growth in large cities and to encourage their decentralization towards other organized suburban centers. The expatriate population should also be included. More reclamation would gain land in geographically small countries such as Bahrain, Qatar, the UAE, and Kuwait. Affordable housing delivery systems should cover the availability of land, finance, infrastructure, services, construction, building materials and maintenance.
Both public and private sectors should be engaged. The private sector can coordinate with the government on housing and urban development projects by providing the resources to put cash flow into residential development for affordable housing costs such as housing maintenance and restoration, and providing roads, electricity, telecommunications, water and sewerage, solid waste. The private sector can also play a positive role in easing the housing crisis by increasing monthly salaries of young nationals.
NGOs and communities should participate in planning and designing models of affordable housing that meet the needs of the young population, including the cultural, environmental, and functional aspects of residential development. Municipalities should play a major role as key partners in site design and planning for housing projects in providing solutions to the needs of the community.
The focus should be on increasing the construction of smaller affordable houses and integrating projects within cities, rather than marginalizing them on the fringes, to prevent the rise of slums. In developing suburbs, design should include a modern urban infrastructure and public services and take into consideration the development of commercial centers and the provision of public transport and transit system for commuting to work and schools. The quality of construction should be a priority, including sustainability and "green building," to meet concerns about economy, utility, durability and environmental considerations.
To make affordable housing more accessible, GCC governments should provide flexible financing options, introduce adjustments to existing property legislation, and establish new mortgage laws that will govern property ownership, repossession, enforced eviction, and asset liquidation. Community mortgage programs should be encouraged for those with lower income. Banks can help lending through the elimination of high interest rates and conformity to Shariah regulations.
Affordable housing is nowadays a strategic entry point to mitigate poverty issues in the Gulf region. The need for affordable housing continues to outstrip supply and governments, municipalities, communities, NGOs, developers, planners, and mortgage providers must work together to deal with the problem before it becomes unmanageable.

— Dr. Mona AlMunajjed ([email protected]) is a sociologist, author and adviser on social and gender issues.