Abstract
This paper discusses the impact of property management in maintaining the value of residential product in Saudi Arabia. The paper reviewed a comparison of two property models: the first is managed by the property management system, and the second is managed by the owner only. In addition, the field questionnaire was used and distributed to a sample of the study community consisting of 125 real estate management institutions and real estate office in Riyadh. The results of the analysis indicate that property management contributes to raising the quality of the residential product and maintaining its market value. The residential product which managed by the property management system loses 10% of its value after 5 years. On the other hand, the product that managed by the owner loses more than 50% of its real value after 5 years. The paper proposes to strengthen cooperation between governmental and private institutions to establish a Real Estate Data Center (REDC) for the classification of residential properties subject to the criteria of management, quality and economic cost.
Highlights
Real estate sector in Saudi Arabia has witnessed remarkable developments in recent years and has introduced laws that regulate the relationship between real estate market participants
Research Objective This paper aims to analyze the impact of property management on the value of residential product in Riyadh
The research data were obtained through in-depth analysis of a number of government reports from the high Commission for the Development of Riyadh (HCDR), General Authority for Statistics (GAS), the Ministry of Housing, and the Chamber of Commerce and Industry in Riyadh (CCIR)
Summary
Real estate sector in Saudi Arabia has witnessed remarkable developments in recent years and has introduced laws that regulate the relationship between real estate market participants. The vision of the Kingdom of Saudi Arabia 2030 emphasized improving the performance of the real estate sector through increasing its contribution to the GDP, stimulating the supply, and raising productivity (Vision of the Kingdom 2030, 2016). The housing strategy has focused on bridging the gap between supply and demand in the housing market by continuing to provide housing subsidies to eligible groups (Alzamil, 2016) In this context, the [Tenth Development Plan] seeks to develop an efficient and sustainable housing sector that contributes to achieve the comprehensive urban development. The [Tenth Development Plan] seeks to develop an efficient and sustainable housing sector that contributes to achieve the comprehensive urban development This sector shall be able to enable all segments of society to access the real estate market, in which the government plays an enabling role, and the private sector has a central role in both financing and implementation (Ministry of Economy and Planning, 2017).
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