Estattor.com

Tag: Saudi housing market

  • 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.