RIYADH- Saudi Real Estate Refinance Co (SRC), the Saudi equivalent of U.S. mortgage finance business Fannie Mae, expects a temporary slowdown in the mortgage market over the next few months as the new coronavirus hits housing demand, its CEO told Reuters.

SRC, a wholly-owned subsidiary of Saudi Arabia's sovereign wealth fund, the Public Investment Fund (PIF), works with developers and local banks to counter a shortage of affordable housing - one of the country's biggest social problems and a top priority of economic reform - by injecting liquidity into the real estate market.

"The curfews implemented in different cities across the kingdom mean that visiting properties is challenging to say the least, so you can expect some slowdown in the market," said CEO Fabrice Susini.

"However, the impact will be an element of temporary slowdown and temporary deferral, but I don't expect it to fundamentally change the nature and the growth rate of the market, which is supported by demographic trends," he added.

SRC purchases home loan portfolios from mortgage financing companies and banks to boost a secondary mortgage market that has helped to service rising housing demand among the kingdom's youthful population in recent years.

Among the goals of the Vision 2030 reform programme promoted by Crown Prince Mohammed bin Salman, the kingdom aims to increase home ownership to 60% by 2020 and 70% by 2030.

New mortgage contracts by banks in the kingdom reached 24,000 in February at a value of 10.24 billion riyals ($2.7 billion), jumping from around 9,000 contracts valued at 4.2 billion riyals a year ago, central bank data shows.

SRC aims to refinance 20% of Saudi Arabia's primary home loans market, which authorities hope to expand to 500 billion riyals by 2020 and 800 billion riyals by 2028.

The company's original goal for this year was to deploy 22 billion to 23 billion Saudi riyals, but given current market circumstances this seems "very, very ambitious", Susini said.

SRC is preparing to launch an international sukuk, or Islamic bond programme, to back the purchase of home loan portfolios, he said without disclosing how much it intends to raise.

(Reporting by Marwa Rashad Editing by David Goodman) ((marwa.rashad@thomsonreuters.com; +966114868476; Reuters Messaging: marwa.rashad.thomsonreuters.com@reuters.net))