Navigating Potential Disconnect Between National Affordable Housing Policy Objectives and Local Market Dynamics

Real estate development is inherently a local enterprise. Specific market dynamics in a submarket often
determine how development projects get built. Policy objectives however are determined at a national
level. Therefore, when national policy concerns real estate development projects, there is the potential
issue of a ‘’policy disconnect’’ between national objectives and local market dynamics. International
best-practice has revealed that the best solution is a combination of local involvement and a multi-
tiered policy structure.

It is imperative for a successful policy objective that local and regional government agencies involved in
housing and real estate development are consulted and invited to have input in the process. This
ensures that all issues are considered and that where possible, local concerns are injected into the
national policy objective discussion. It is similarly essential that any affordable housing policy is
organized in a multi-tiered structure:

• In the first tier, Broad-based national level policy objectives serve as the ‘’guiding principles’’
  and outline the vision, mission, and objectives of the affordable housing program, as well as
  long-term expected results and the overall funding and budget structure for the affordable
  housing program.
• In the next tier, regional government bodies can be tasked with creating and tracking the
  program’s Key Performance Indicators (KPIs), housing typologies, assessing detailed citizen
  demand for housing, and monitoring the performance of local government bodies
• In the final tier, local government bodies can be tasked with implementing projects in-line with
  local market realities, managing private-sector involvement, selecting the appropriate
  development model typologies, and monitoring project execution

With this multi-tiered structure, national housing policy can be effectively executed on a local scale.

Part 2 of TCN’s White Paper on Affordable Housing in the Kingdom of Saudi Arabia will provide more
details on the above and will be released shortly.