Saudi Arabia's central bank revealed new mortgage measures aimed at galvanising the housing market as the kingdom embarks on boosting affordable homes for its citizens.
The Saudi Arabian Monetary Authority (Sama) said on Twitter that mortgage holders will be exempt from paying administrative fees when they switch between floating loan rate to fixed loan rates.
Mortgage holders can also move from one mortgage lender to another at no extra cost.
Faced with a housing shortage, Saudi Arabia is undertaking a slew of measures to help provide homes to its citizens as part of its National Transformation Program 2020, which aims to increase the percentage of Saudi home ownership from 47 per cent to 52 per cent.
The programme envisages increasing the percentage of real estate financing to non-oil GDP to 15 per cent from 8 per cent.
The plan also sets a goal of tripling the percentage of residential units developed by approved real estate developers to 30 per cent by 2020.
Sama also said in January it would allow mortgage finance companies to provide more funding to home purchases by raising the maximum loan-to-value ratio for home financing from 70 per cent to 85 per cent for citizens' first home ownership only. The bank licensed a national home finance company, Bidaya and introduced an affordable mortgage programme in conjunction with the ministry of finance. The government also approved a 2.5 per cent "white land tax" to prod land owners to develop idle plots for residential use rather than hold on to their undeveloped properties.