Housing prices for pilgrims drop by

JEDDAH: Prices of hotels and furnished apartments dedicated to pilgrims dropped by 60 percent on average during this Haj season compared to previous years, according to investors.

Accommodation prices for pilgrims dropped from SR10,000 to SR2,000 due to the increased number of hotels and furnished apartments and also due to the decline in the number of pilgrims.

According to investors in Makkah hotels and furnished apartments, hotel owners decided to cut prices to attract larger numbers of pilgrims and thus minimize possible losses due to higher supply than demand.

Wafi Al-Qahtani, an investor in the hospitality industry, said that several hotel owners lowered the prices of accommodation by 60 percent.

For example, a unit previously rented for SR3,000 was reduced to SR750; owners would rather rent rooms to cover just 20 percent of expenses than incur bigger losses.

Al-Qahtani added that there are about three million beds in Makkah to accommodate 1.5 million pilgrims.

“The number of beds increases annually while the number of pilgrims is as it was, and that has a bad effect on prices,” he said.

Al-Qahtani also said that prices per bed reached SR600 while it used to be SR3,000 three years ago, a 75 percent decline that led to the closure of some hotels, especially in Al-Aziziah district.

Losses registered during Haj are recovered in Umrah season.