Housing sector challenges persist despite gains, say stakeholders

AMMAN — Despite the housing sector’s strong performance, there remain challenges that hinder its growth, mainly high interest rates and sales tax, according to stakeholders.

On Monday, Jordan Housing Developers Association (JHDA) President Kamal Awamleh, told The Jordan Times that housing sales witnessed an increase of around 25 per cent during the first quarter of 2023 when compared with the same period of 2022.

During Ramadan, sales are usually down, which Awamleh considers normal, but still the sector has witnessed a “good increase” in transaction performance, compared with previous years.

Awamleh said that there is no run-up in prices, as sector investors seek to encourage people to buy residential properties, especially first-time homebuyers. However, this has negatively affected investors’ gross profits, which might force investors to pull out of the market, he added.

Moreover, Awamleh noted that housing loan interest rates are high, stressing the need for programmes that subsidise housing loans.

Mahmoud Salah, a housing expert, told The Jordan Times that “there is a need for supportive and clearer regulations”, as sometimes there can be difficulties in carrying out certain dealings.

Agreeing with Awamleh, he pointed out that among the major challenges affecting the sector are the high interest rates, in addition to the high sales tax on production inputs.

According to Awamleh, around 6,000 apartments were sold during the first quarter of 2023, compared with 6,077 apartments sold in the same period of 2022.

Awamleh noted that the 25 per cent increase witnessed during the first quarter of this year includes land plots.

Touching on other challenges, the Housing Developers Association president said that investors sometimes face difficulties and long waiting periods when obtaining approvals to buy land plots.