SAUDI ARABIA REAL ESTATE MARKET

Saudi Arabia real estate market growth is surging due to the ambitious government initiatives, growing population, along with robust economic development and rising commercial activities.

Major Saudi Arabia Real Estate Market Drivers and Emerging Trends

The real estate industry plays a vital role in the Saudi Arabian economy which accounts for approximately seven percent contribution to the GDP and creates around 40,000 jobs. Reflecting optimism in its economic reform initiatives, the Kingdom has increased its fiscal surplus forecasts, supported by rising oil prices. Amidst economic expansion, the real estate sector plays a crucial role by offering housing, enabling business operations, and presenting investment opportunities. The value generally increases over time which positions it as a key driver of wealth creation and diversification for investment portfolios.

Saudi Arabia real estate market overview is observing significant growth as the government has implemented numerous reforms and initiatives which reflect the Vision 2030 plan to reshape the housing sector in the country. A major aim is to boost home ownership rates by seventy percent by 2030. Approximately USD 1 trillion in infrastructure and real estate projects are in progress with plans for at least eight additional new cities.

Initiatives such as the Sakani program and better financing options which are introduced as part of Vision 2030 have significantly raised residential properties ownership rates. The Saudi Housing Program has also taken the place of the previous system which was plagued by slow processing and did not meet citizen satisfaction. The Ministry of Municipal and Rural Affairs and Housing has developed a new housing framework in the past few years. It forms over sixteen separate entities responsible for managing essential housing market reforms and initiatives. The significant transformation of Saudi Arabia’s real estate market trends thereby can be attributed to the government’s effective initiatives and policies. That includes improved financial access, tax reforms, digital support, along with collaborations with regulatory agencies and private sector.

The government has also introduced a new initiative designed to speed up its plan for attracting foreign companies with provisions allowing certain businesses to operate without establishing a headquarters in Saudi Arabia. Businesses that have foreign operations under around USD 266,000 are allowed to operate in the country without needing a local headquarters. The move is anticipated to stimulate the construction of retail spaces, offices, hospitality facilities and various infrastructures along with overall investment. With these initiatives combined with supportive demographic factors, Saudi Arabia real estate market 2024 and beyond is expected to undergo significant transformation.

The other factor supporting Saudi Arabia real estate market size expansion is the growing population and rapid urbanization. Saudi Arabia represents more than fifty percent from the total GCC population which makes it the most populous country in the region. With the population projected to increase to more than 47 million people by 2050, it is expected to see a rise in households which will fuel a notable increase in housing demand. The increasing population along with rapid urbanization has fueled a growing demand for affordable housing particularly for individuals with average incomes or less in cities where land and construction material costs are significantly high.

With the swift expansion of cities in the country, there has been a corresponding increase in the need for housing, commercial real estate, and various property types. This spike in demand has led to more investment in new projects which cover office buildings and residential. The surge in e-commerce and the rising trend of online shopping have also created a greater need for logistic spaces. This leads to an increased requirement for industrial properties.

Based on the property type, the market can be segmented into residential, hotel, office, retail, and others. As housing has been recognized as a critical project in Vision 2030, the residential sector is taking the lead. The Housing Ministry plans to construct 300,000 residential units in collaboration with the private sector in the next five years. Recently the residential sector achieved impressive momentum by providing 27,500 units in Jeddah and Riyadh. This brings the total units to 1.46 million in Riyadh and 891,000 in Jeddah. The residential sectors are also growing to support an increasing population which is influenced by immigration and lifestyle decisions which in turn strengthens the market.

The hospitality sector including hotels and villas also experienced growth as the country gears up to host 150 million tourists. The tourism and hospitality industry are a key contributor to the real estate market as luxury hotels and resorts are accommodating the growing guests.

The office market continues to be competitive as landlords are actively prompting negotiations and welcoming new entrants. Meanwhile, the retail market has shown stability despite facing some pressures.

Top Market Players

Several key players within the market include Ewaan, Kingdom Holding Company, SEDCO Development, Al Saedan Real Estate, among others.

Segments covered in the Report:

The Real Estate Market has been segmented on the basis of Property Type. Based on the Property Type, the market is segmented into Residential Real Estate, Office Real Estate, Hotel Real Estate, Retail Real Estate and Others.

Market Segmentation

Saudi Arabia Real Estate Market by Property Type

• • Residential Real Estate
  • Office Real Estate
  • Hotel Real Estate
  • Retail Real Estate
  • Others

Saudi Arabia Real Estate Market Leading players (Option 1: Free 25% Customization – Profiles of 5 Additional Companies of your Choice)

• • Ewaan
  • Kingdom Holding Company
  • SEDCO Development
  • Al Saedan Real Estate