Arab News

JEDDAH: The Makkah-Madinah real estate index fell 7.6 percent last year, as the coronavirus disease (COVID-19) pandemic and global lockdowns stopped people from traveling to the two holy cities.

The Ihsan Al-Haramain Index is used to track companies involved in real estate development in Makkah and Madinah.

Daily access and prayers to the Prophet’s Mosque in Madinah stopped for more than 70 days, while regular access to the Grand Mosque in Makkah also came to a halt.

“Despite the COVID-19 pandemic, global lockdown and global travel coming to a standstill in 2020, the fundamentals of demand for real estate in the holy cities meant that the impact, albeit significant, was in the short and medium term, as the fourth quarter opening allowed the sector to make some recovery,” Talal Mahmood Malik Al-Alawi, chairman and CEO of global real estate advisory firm Alpha1Estates, said in a statement.

“2020 also helped to ensure the real estate sector in the Kingdom continues to have relatively high levels of indebtedness, rising financial costs, and is still affected by external factors such as a low oil price, geopolitical risks, and the general economic outlook, but there is a concerted effort to tackle these.”

Alpha1Estates was launched in 2006 and became the world’s first company to market Makkah and Madinah property to an international audience.