As part of a drive to curb real estate speculation, Saudi Arabia has banned the marketing and presale of building projects which are still in the planning stage except with the approval of a newly-formed government committee.
Although Saudi Arabia is the largest real estate market in the Middle East, bankers and real estate brokers report significant property shortages. They attribute this to rampant speculation linked to sales of plots of land and units during the pre-construction phase as well as growing demand from a young population.
Such speculation has fuelled rising rents and property values, some of which exploded by up to 30 per cent in 2008.
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