RIYADH: Saudi Real Estate Refinance Co (SRC), the Saudi equivalent of US mortgage finance business Fannie Mae, said on Sunday it has agreed to buy a mortgage portfolio worth over 3 billion riyals ($799.8 million) from the Saudi Public Pension Agency (PPA).

"The deal provides liquidity to the real estate financing market, which in turn is expected to bring lower prices and increase the number of mortgage originations - leading to SRC's goal of improving homeownership rates in the Kingdom," Fabrice Susini, CEO of SRC, said in a statement.

SRC, a wholly-owned subsidiary of Saudi Arabia's sovereign wealth fund, the Public Investment Fund, works with developers and local banks to counter a shortage of affordable housing by injecting liquidity into the real estate market.

Among the goals of the Vision 2030 reform programme promoted by Crown Prince Mohammed bin Salman, the kingdom aims to increase home ownership to 70% by 2030. "This agreement will help the liquidity in the market and help us provide more mortgages to people to buy homes," said Mohammed Al Nahhas, governor of PPA.

The deal comes amid a severe downturn in the Saudi economy, battered by the coronavirus crisis and lower oil prices.