The Jordanian real estate sector continues to suffer for the third year in a row. The sector has been incurring losses without any radical solutions.
Real estate sector suffer demand decline due to difficult economic conditions the Jordanians are going through, in addition to high construction costs.
The Jordanian real estate sector trading volume decreased by 26% last year, reaching a value of 3.4 billion Jordanian dinars.
Jordanian real estate sector
Investors in the real estate sector said real estate demand, especially residential apartments, has declined over the past three years.
Taxes and complexities of the building system contributed to the rise of prices. In addition, sales to non-Jordanians decreased while land prices are sky-high.
The Jordanian cabinet announced approving the recommendations of the committee charged with developing a plan to address the impact of COVID-19 on real estate.
The plan aims to stimulate the sector in the next stage in order to reach sustainability and growth.
A specialized committee
The recommendations included forming a specialized technical committee to study the axes of urban densification. This committee is supposed to come up with new recommendations and re-engineering and automating procedures to link government operations that serve the housing sector.
The recommendations also included mandating the General Organization for Housing and Urban Development to prepare a draft law regulating the development of construction, investment in real estate sector. The draft law aims to create a regulatory environment for the housing sector. It will be submitted to the Council of Ministers to proceed with the procedures for approving the draft law.
The head of the Housing Sector Investors Association, Kamal Al Awamleh, said the Jordanian real estate sector decline negatively affected the whole Jordanian economy. He added that the sector is one of the main tributaries of the gross domestic product.
Real estate provides jobs to a lot of people and drives other sectors associated with it. The sector provides the market needs for apartments of different sizes.
Al-Awamleh said the housing sector is in urgent need of reducing taxes, facilitating the approved procedures and reviewing the registration fees with the Land Department.
Official data indicate the number of housing companies is about 2,700 companies, with a capital ranging between $3.5 – $4.23 billion.