Dissertation_Dr Faisal Almubarak

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government spending fueled city-ward migration, improved living standards, and enticed
expatriates, all of which fell heavily on the stagnated housing market. Housing was one of
the primary items of the ambitious national five-year plans of the 1970s. The REDF,
which was launched to increase the production of houses by individuals and private firms,
was earmarked with hefty sums in the second plan (1975-1980). The second Five-Year
Plan (1975-80) allotted $142 billion (compared to the first Five-Year Plan of $9.2) for
building the country's physical infrastructure (e.g., the construction sector to build housing
units and provide industrial buildings, schools, and hospitals, among others). The Plan
envisaged the funding of 329,000 housing units nationwide at the cost of $24.5 billion.
Although the Second Plan (1975-80) was earmarked with a total of 92,000 dwelling units
for Riyadh, it was not until 1991 that the number of REDF-financed housing loans reached
85,878, at the cost of $6.67 billion. Moreover, more than 13,097 housing units were
constructed by the various government agencies in the city.
This contributed to the flight from the congested older, mostly mud, residential
neighborhoods and to the centrifugal waves of building activity toward the periphery (72%
of Saudi households moved to their present residents in the period 1982-87). By 1988, the
REDF contributed to the construction of 413,958 private housing units in 2,531 Saudi
settlements. 52 The REDF has also dispensed 2,358 investment loans at a cost of $1.3
billion to finance the production of another 26,488 housing units, 1,612 office buildings,
and 3,703 shops nationwide. By 1988, the REDF-subsidized loans reached a sum of
$27.2 billion, nationwide. 53 In addition, to enable the low-income population to obtain a
REDF loan, which stipulated land ownership, Riyadh's Municipality has distributed more
than 100,000 lots amounting to an area of more than 45 square kilometers (out of a total
city residential area of 92 km 2 ) free of charge. 54 The combined efforts of these housing
subsidies and programs have contributed to a housing stock of 349,605 units in Riyadh
alone (Table 5.4). A 1987 survey by the High Authority For Riyadh Development
(HARD), which covered 297,860 units of Riyadh's 349,605 housing stock, concluded that
"due largely to assistance from the REDF, the majority of Saudis (86 % of the heads of
households) own their own home. Of those who own, 65 per cent received a loan from
this fund." 55
The generous REDF loans enabled many Saudis to attain a high level of construction
and finishing standards, a luxury which matched that of the aristocracy. These luxurious
accommodations were to reward the rising ranks of the middle class and tacitly symbolized