AMMAN — The total area of licensed real estate in the
Kingdom saw a 92.1-percent rise during the first five months of this year,
compared to the same period of 2020, according to statistics by the Jordan
Engineering Association (JEA).
اضافة اعلان
These are the approved blueprints for licensed real estate
by the syndicate, not the government, explained Abdullah Ghosheh, head of the engineering offices committee
at the JEA in an interview with Jordan News. The application for
licensing starts with this procedure, he said.
“From 2016 till 2020 there has been a consistent drop in
(licensed areas) averaging about 20-30 percent a year. It appears that now we
are going back to the normal range in real estate activity in Jordan, where
around 4.5 million square meters have been licensed so far.”
A breakdown of these figures shows that about 75 of the
approved building projects are in the residential sector. This is due to organic
demand.
“There is an organic demand for 60 thousand units a year
with population growth. Plus, a good portion of expats need real estate; due to
the regional geopolitical situation, Jordan is among the safer areas in the
region,” Ghosheh explained.
Another factor that has affected this growth is the
perception that real estate is a safe sector for investment. Ghosheh explained
that while several industries suffered due to COVID-19, this sector managed to
remain stable.
“Real estate is a safe sector, as there is a natural need
for it, and so I expect that it will keep growing,” he said. “But at the same
time, so that citizens and the country benefit from this, we need to simplify
the licensing processes.”
Experts agree that the real estate and construction
licensing processes in Jordan are lengthy and inefficient. This acts as an
obstacle to the initiation of projects. “We need a reevaluation of government
strategies because there are people who want to invest, and it is important to
pay attention to them,” said Ghosheh.
For this reason, among others, Ismail Saudi, a real estate advisor and member of Jordan Economic Forum, believes that
other indicators in the sector need to be considered.
“The licensed areas for building
are an important indicator, but a better economic indication is to look at the
actual exchanges that take place in the real estate sector,” he said in an
interview with Jordan News.
The value of real estate
activity in
Jordan reached JD7.8 billion in 2014, the highest figure recorded
in the country’s history, explained Saudi. Given population growth rates and
the availability of wide-geographical areas, this number was expected to
increase.
“Yet, in 2019 the figure was JD4.6
billion, this is almost 60 percent less than what it was before,” the expert said.
“As for 2020, we recorded JD3.4 billion in real estate activity.”
He believes that the issue goes
back to several factors. This includes zoning, areas in the country that are not
officially planned by municipal authorities in a manner that allows investors
to construct residential areas with easy access to Amman. Others include
higher-than-average bank interests on home loans, and high taxation rates
imposed on real estate.
“We are looking into new systems
and regulations to regulate real estate planning in Jordan for companies and
individuals,” said Saudi. “Owning property is considered a sign of wealth; it
is the base of a nation, an essential requirement that we have not been able to
satisfy.”
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