‘Somewhat frozen’, local housing sector witnesses deterioration in investments

AMMAN — Investment in the local housing sector is deteriorating due to a lack of incentives, according to stakeholders.

Former president of the Jordan Housing Developers Association (JHDA), Kamal Awamleh, said that it is crucial to give incentives to investors and reduce the sales tax, in order to deliver affordable housing options for low or limited income individuals. 

Currently, almost 70 per cent of houses are purchased in Amman, with 24 per cent in northern governorates and 8 per cent in southern governorates, Awamleh said. 

Awamleh attributed the investment decline to increasing operational costs, low profits and higher interest rates — which have reached 12 per cent. 

“This year, there will be no more than 35,000 apartments sold,” he said. “43,000 apartments were sold in 2021, compared with approximately 33,000 apartments sold in 2022.”

Real estate prices are not decreasing, without even a “modest fall” in overall prices, housing expert Mahmoud Salah told The Jordan Times on Saturday. Salah described a need to increase the quantity of affordable housing. “That is done by making it easier for stakeholders to operate,” he said.

Supporting the housing sector has social and economic benefits, Salah said, adding that when investors are supported, prices decline and more longterm renters become homeowners, which leads to consistent economic growth.

Previously, Salah noted that the sector started to weaken in April, and has since started becoming somewhat of a “frozen market”.