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Tag: Saudi Arabia real estate

  • Saudi Real Estate Prices Rise 1.3% in Q2 2026

    Saudi Real Estate Prices Rise 1.3% in Q2 2026

    The Real Estate Price Index rose 1.3 percent in the second quarter compared with the corresponding period of 2025, reversing the 1.6 percent decline recorded during the first quarter. The quarterly increase was driven primarily by a 2.6 percent rise in residential property prices and an 11.3 percent increase in agricultural real estate prices, while commercial property prices declined 3.2 percent.

    Residential land prices increased 6.3 percent year-on-year during the second quarter, providing the strongest contribution to the overall index. Apartment prices rose 1.1 percent and residential floor prices edged 0.4 percent higher, while villa prices declined 9.7 percent.

    On a quarterly basis, the Real Estate Price Index increased 3 percent from the first three months of 2026. Residential property prices rose 3.7 percent quarter-on-quarter, supported by a 6.1 percent increase in residential land prices.

    Regional Performance Shows Wide Variation

    Real estate price movements varied considerably among Saudi Arabia’s administrative regions during the second quarter. Al-Jouf registered the highest increase at 10.4 percent, followed by the Northern Borders region with growth of 4.6 percent. Riyadh recorded a 4.2 percent annual increase, while prices in Makkah rose 0.4 percent.

    Hail recorded the steepest annual decline at 10.1 percent, followed by Qassim with a 5.4 percent decrease. Prices also declined 4.5 percent in Madinah and 2.8 percent in Al-Baha.

    Business Revenues Surge 11.4%

    Saudi Arabia’s Operating Revenues Index increased 11.4 percent year-on-year in May 2026, according to preliminary short-term business statistics released alongside the property data. Mining and quarrying recorded the largest increase among main economic activities, with operating revenues surging 38.7 percent.

    Manufacturing revenues rose 9.6 percent, while wholesale and retail trade revenues increased 3.6 percent. Financial and insurance activities recorded growth of 12.9 percent, and transportation and storage revenues increased 9.5 percent.

    Construction operating revenues advanced 2.5 percent, while real estate activities recorded growth of 5.8 percent. Accommodation and food services rose 8.2 percent, and information and communication revenues increased 4.8 percent.

    Employee Compensation Rises

    The Employee Compensation Index increased 9.8 percent year-on-year in May 2026. Accommodation and food services recorded the highest increase at 17.7 percent, followed by other service activities at 14.8 percent. Manufacturing employee compensation rose 11.4 percent, while financial and insurance activities increased 12.8 percent.

    Transportation and storage compensation rose 13.6 percent, while construction recorded an increase of 7.6 percent. Compensation in wholesale and retail trade increased 9.4 percent.

    Building Permits Decline Sharply

    The number of building permits issued in Saudi Arabia fell 33.3 percent year-on-year in May, with 5,056 permits issued during the month compared with 7,584 permits in May 2025. The number also declined 25.7 percent month-on-month from April 2026.

    The permit data contrasted with the quarterly rise in real estate prices and the annual increase in construction operating revenues, presenting a mixed picture of the market.

    Vision 2030 Housing Targets Advance

    Saudi Arabia’s real estate market continues to develop alongside the Housing Program under Vision 2030, which aims to increase homeownership among Saudi families to 70 percent by the end of the decade. The homeownership rate reached 66.24 percent at the end of 2025, exceeding the annual target of 65 percent and rising from 47 percent before the launch of the national housing transformation.

    GASTAT calculates the Real Estate Price Index quarterly using data from completed real estate transactions across Saudi Arabia. The system employs a geospatial artificial intelligence model to process different types of real estate transactions and connect them with multiple data sources and satellite imagery.

    The second-quarter data indicates that while Dammam’s property market surged earlier this year, the national picture now shows broader residential strength concentrated in land and apartment segments, while villa prices continue to face headwinds and commercial properties remain under pressure.

  • Dammam Outpaces Riyadh with 71% Home Sales Surge in Q1 2026

    Dammam Outpaces Riyadh with 71% Home Sales Surge in Q1 2026

    Around 2,900 homes were sold in Dammam between January and March 2026, representing a 41% increase from the final quarter of 2025, when transactions were valued at SAR2.1 billion, according to Cavendish Maxwell. Sales volumes were 25% higher than a year earlier, while the total value of transactions increased 48%.

    March was the busiest month of the quarter, with 1,265 residential sales completed despite regional tensions.

    The rise in Dammam contrasted with more measured activity in Riyadh and Jeddah, where affordability pressures, financing costs and a period that included Ramadan and Eid affected transactions.

    Riyadh Rents Decline as Supply Increases

    Tenants in Riyadh saw some relief during the first three months of the year, with apartment rents falling 2.8% compared with the previous quarter and villa rents declining 1.2%.

    The reductions were partly linked to the rent freeze introduced in September and the delivery of new residential supply in the capital. Rental costs remained higher than a year earlier, with apartment rents up nearly 6% and villa rents rising more than 5%, although quarterly declines indicated that the pace of growth had begun to ease.

    Riyadh recorded 8,800 home sales worth SAR13.4 billion during the quarter. Transaction volumes increased nearly 12% from the final three months of 2025, while sales values rose more than 4%. Activity remained considerably below the elevated levels recorded a year earlier, with sales volumes down 64% and values falling 72% compared with the first quarter of 2025.

    Home Prices Show Limited Movement

    Residential sales prices continued to rise annually across Riyadh, Jeddah and Dammam, although there was little movement from the previous quarter in most areas.

    Apartment prices in Riyadh averaged SAR6,200 per square metre, up 3.7% from a year earlier. Villa prices rose nearly 7% to SAR5,700 per square metre, with both categories broadly unchanged from the fourth quarter.

    Jeddah apartment prices increased nearly 2% annually and 1.3% during the quarter to SAR4,400 per square metre. Villa prices reached SAR5,200 per square metre, representing annual growth of 3.3% and a quarterly increase of 1%.

    Dammam apartment prices rose 4% from a year earlier, while villa rents increased 3.2% annually.

    Jeddah Transactions Decline 25%

    Residential sales in Jeddah fell 25% from the previous quarter and around 30% from a year earlier. Investors and buyers completed 5,800 transactions worth SAR7.2 billion during the first three months of 2026.

    While the potential implications of the regional geopolitical situation remain closely monitored by market participants, it is still too early to draw definitive conclusions. Saudi Arabia’s residential market remains supported by strong domestic demand, with a predominantly local buyer base providing a degree of resilience against short-term external shocks.

    Kevin Duffield, Director of Built Asset Consulting at Cavendish Maxwell, said in a statement released on July 13, 2026.

    New Supply Enters Market

    Riyadh added almost 3,000 homes during the first quarter, taking its residential inventory to around 1.94 million units. Another 31,000 units are due before the end of 2026, followed by 61,500 units through the end of 2028.

    Jeddah delivered 1,500 homes during the quarter, lifting its inventory to around 1.1 million units. A further 17,500 homes are scheduled for this year, with nearly 46,000 more expected over the following two years.

    Dammam is expected to receive 4,800 new homes during 2026, taking its inventory to 435,000 units. Deliveries are scheduled to rise to 10,600 homes in 2027, followed by another 3,500 in 2028.

    Duffield noted that development pipelines are evolving across each city, with Riyadh seeing the most new supply in the medium term, and growth in Jeddah and Dammam more modest and measured.

    Foreign Buyers Gain Access

    Saudi Arabia’s foreign property ownership law, introduced in January 2026, allows non-Saudi individuals and companies to invest in real estate within approved areas.

    Designated locations in Riyadh include Qiddiya, New Murabba and King Abdullah Financial District, while more than 55 zones in Jeddah have been opened to foreign ownership. NEOM, The Red Sea Project, Amaala, AlUla and King Abdullah Economic City are also covered by the framework.

    Separate rules apply in Makkah and Madinah, where ownership in designated zones is restricted to Muslim buyers.

    Dammam’s strong performance in Q1 2026 reflects the city’s growing appeal as affordability and supply dynamics shift across Saudi Arabia’s main urban markets. With regional real estate markets expanding rapidly, investor attention is increasingly diversifying beyond traditional capitals.

  • Saudi Arabia Launches Property Ownership Portal for Foreign Investors

    Saudi Arabia Launches Property Ownership Portal for Foreign Investors

    The Saudi Properties portal marks a significant shift in the Kingdom’s approach to international real estate investment, offering a streamlined digital pathway for non-Saudis to navigate ownership regulations that previously required extensive in-person procedures.

    The platform enables prospective buyers from inside and outside Saudi Arabia to complete regulatory procedures online, check available ownership routes, view approved real estate opportunities, verify eligibility requirements, submit applications, and track their requests through a unified interface.

    How the Application Process Works

    Non-Saudi residents already in the Kingdom can apply directly through the portal using their residency number, with eligibility checks and procedures completed through an automated digital process.

    Applicants outside Saudi Arabia must first obtain a digital identity card from Saudi missions abroad before completing their online application. Non-Saudi companies and entities without an existing presence in the Kingdom must register with the Ministry of Investment through the Invest Saudi platform and obtain a national unified number before completing the ownership process electronically.

    The system allows non-Saudi individuals, companies, and entities to own property across various regions of Saudi Arabia, subject to the approved geographic scope and regulatory framework.

    Special Rules for Holy Cities

    Ownership in Makkah and Madinah remains regulated under specific rules. Property ownership in the two Holy Cities is limited to Saudi companies and Muslim individuals from inside and outside the Kingdom.

    The Real Estate General Authority said the framework is designed to make ownership decisions more transparent by linking property opportunities to official data sources and structured regulatory pathways, which will improve market credibility, support higher-quality urban growth, and enhance the experience for applicants.

    The move builds on Saudi Arabia’s broader economic transformation strategy, positioning the Kingdom alongside regional competitors like the UAE in attracting international property investment. While the UAE leads global rankings with 56% of investors planning to increase exposure, Saudi Arabia’s new digital infrastructure may accelerate its appeal to foreign capital seeking diversification beyond Dubai and Abu Dhabi.

    REGA emphasized that the Saudi Properties portal is the official channel for foreign real estate ownership applications and for accessing key information related to owning property in the Kingdom.

  • Dammam Emerges as Top Choice for Saudi Homebuyers in 2025

    Dammam Emerges as Top Choice for Saudi Homebuyers in 2025

    Saudi Arabia’s housing market is experiencing a notable geographic shift, with Dammam capturing increasing buyer attention as affordability pressures reshape demand across the Kingdom’s three major cities.

    According to Cavendish Maxwell’s 2025 KSA Residential Real Estate performance report released on April 2, 2026, Dammam recorded a close to 30% increase in sales values to SAR10.7 billion, supported by more accessible pricing and steady economic activity in the Eastern Province.

    “Dammam, where property is more affordable compared to other cities, was the standout performer and is poised for sustained growth supported by competitive pricing and robust economic activity in the region,” said Siraj Ahmed, Director and Head of Strategy and Consulting at Cavendish Maxwell.

    The performance contrasts sharply with Riyadh, where residential transaction volumes fell 31% year-on-year despite the capital maintaining its position as the largest market by value with SAR96.2 billion in sales across 56,600 transactions. Average transaction values in Riyadh reached SAR1.7 million, reflecting higher property prices and elevated financing costs that have reduced purchasing power.

    Jeddah delivered its strongest performance in years, recording 30,500 residential transactions with total sales of SAR36.6 billion. The average deal size stood at SAR1.2 million, reflecting steady end-user demand.

    Recent policy interventions are expected to influence market dynamics through 2026 and beyond. A five-year rent freeze introduced in 2025 and adjustments to the White Land Tax aim to encourage development and improve affordability, particularly in Riyadh where supply constraints have been most acute.

    “We expect a recalibration of the market as new supply, the 5-year rent freeze and White Land Tax reforms make property more competitively priced and lead to a recovery in market activity,” Ahmed noted.

    New residential supply continues to enter the market, though delivery timelines remain fluid. Riyadh added 13,000 units in 2025, bringing total inventory to 1.93 million, with tens of thousands more planned through 2027. Jeddah’s pipeline is also expanding, while Dammam is set to add new stock over the same period.

    The expansion in supply is further supported by the recent rise in White Land Tax, which encourages landowners to develop empty plots and accelerate delivery timelines. “The full impact of this reform will likely materialise through this year and beyond, with the gap between demand and supply gradually narrowing, in turn easing price pressure and enhancing affordability,” Ahmed said.

    A new foreign ownership law introduced earlier in 2026 is expected to draw a broader investor base into the market. The framework allows non-Saudi buyers to acquire property in designated zones, marking a shift from earlier restrictions and opening the sector to additional capital.

    Oil price swings and geopolitical developments remain key variables, though underlying demand drivers continue to hold. “External factors including oil market volatility and geopolitical tensions of course warrant close monitoring, but Saudi’s residential market remains well positioned, supported by strong demographic drivers, ongoing infrastructure investment and a continued commitment to Vision 2030,” Ahmed said.

    The diverging performance across Saudi Arabia’s major cities mirrors patterns seen in neighboring markets, where off-plan sales momentum and buyer preferences for affordability continue to shape transaction activity across the Gulf region.

  • GCC Real Estate Markets to Sustain Growth Momentum in H1 2026

    GCC Real Estate Markets to Sustain Growth Momentum in H1 2026

    Kuwait-based investment firm Markaz has released its Real Estate Outlook for H1 2026, forecasting sustained growth across GCC property markets despite evolving macroeconomic dynamics. The report identifies higher oil production, non-oil sector expansion, continued government infrastructure spending, and policy rate cuts as key drivers supporting borrowing and investment activity across residential, commercial, and industrial segments.

    UAE Market Expected to Peak in First Half

    The UAE real estate sector demonstrated exceptional performance through the first three quarters of 2025. In Dubai, transaction values surged 28.3 percent year-on-year to AED554.1 billion, while Abu Dhabi recorded AED58 billion in total sales—a remarkable 75.8 percent annual increase. Transaction volumes in the capital also climbed 42.3 percent to 15,800 deals.

    Dubai continues to offer compelling investment returns, with rental yields standing at 7.47 percent as of June 2025, significantly outperforming major global markets including Singapore, New York, and London. This aligns with recent data showing that long-term UAE renters are turning homeowners amid competitive pricing and flexible payment plans.

    While acknowledging concerns about market sustainability given three consecutive years of exceptional performance, Markaz emphasized that strong fundamentals reduce the likelihood of a sharp correction. The firm forecasts the UAE market could peak in H1 2026, characterized by steady growth in both prices and rental rates across Dubai and Abu Dhabi.

    The outlook reflects broader shifts in buyer behavior across the Gulf, with investors increasingly prioritizing developer credibility, rental yields, and long-term stability over speculative gains.

    Saudi Arabia Maintains Accelerating Phase

    Saudi Arabia’s real estate sector remained in an accelerating phase through H2 2025, propelled by robust residential activity and constrained office market conditions. Residential transactions increased 17.9 percent quarter-on-quarter in Q3 2025, with Riyadh and Jeddah leading price appreciation.

    The Kingdom’s office segment faces extreme supply constraints, with Riyadh vacancy rates near zero, supporting prime rent growth of 7.3 percent year-on-year. Demand stems from the Regional Headquarters Program and expanding healthcare and technology sectors.

    Despite a fiscal deficit projected at 3.7 percent of GDP for both 2025 and 2026, increased capital expenditure under Vision 2030 continues supporting construction activity. Saudi Arabia’s population reached 35.3 million by mid-2024, up 4.7 percent annually, with non-Saudis comprising 44.4 percent—a demographic dynamic that underpins sustained housing demand.

    Kuwait Shows Stable Growth Trajectory

    Kuwait’s real estate sector maintained steady growth through the first nine months of 2025, supported by rising land prices and rental rates. Total real estate sales increased 26.9 percent year-on-year to KWD3.043 billion, with transaction volumes up 27.8 percent to 4,247 deals.

    The investment segment led growth with a 60 percent annual increase in sales, while residential and commercial segments rose 8 percent and 17.4 percent respectively.

    Kuwait’s real GDP is projected to expand 3.9 percent in 2026, driven by higher oil production, improved non-oil activity, stronger project awards, and anticipated interest rate reductions. Based on a Markaz Real Estate Macro Index score of 3.45 out of 5.0, the firm expects Kuwait’s market to remain stable in H1 2026, with prospects for further increases in land prices and rental rates.

    The regional outlook comes as governments continue enhancing investor protection frameworks. Abu Dhabi recently launched mandatory digital registration for off-plan property interests through its Madhmoun platform, with funds secured in government-managed escrow accounts.

    Markaz emphasized that real estate will remain a key contributor to the GCC’s economic development in 2026, offering attractive opportunities for investors across all major property segments as the region’s markets continue to mature and evolve.