Saudi Arabia’s real estate market maintained steady momentum in the second quarter. Moreover, Saudi Arabia real estate prices rose 3.2 percent year on year. Consequently, this steady growth boosts investor confidence and also supports Vision 2030 diversification goals.
Commercial properties led the gains with an 11.7 percent annual increase. Furthermore, commercial land prices surged 12.7 percent, while commercial building prices climbed 2.7 percent. In addition, shop and gallery prices rose 4.1 percent, showing strong demand in the Saudi Arabian property market. As a result, these gains also contributed to higher Saudi Arabia real estate prices.
In the residential sector, results were more mixed. Specifically, residential land prices edged up 0.2 percent. Moreover, villas increased 3.2 percent, and residential floors grew 1.5 percent. However, apartment prices fell 0.7 percent. Even so, the Saudi Arabian housing market still added to the overall growth in Saudi Arabia
Quarterly figures also showed modest improvement. Compared to the previous quarter, the market rose 0.1 percent. In particular, commercial property prices grew 7.9 percent. Likewise, commercial land plots advanced 8.6 percent, and building prices rose 3 percent. Additionally, agricultural property prices climbed 1.7 percent, adding stability to the Saudi Arabian property sector. Therefore, this growth supports consistent Saudi Arabia real estate prices performance.
Regional trends varied across the Kingdom. For instance, the Eastern Province rose 4.2 percent, Makkah grew 3.9 percent, and Riyadh gained 3.6 percent. Meanwhile, Tabuk posted the highest rise at 4.7 percent, followed by Hail at 2.9 percent and Qassim at 1.1 percent. In contrast, Asir, Madinah, and Jazan saw annual declines. Thus, property prices in Saudi Arabia can shift differently across regions.
Government initiatives, such as the regional headquarters program, continue to fuel commercial property demand. Moreover, incentives include tax exemptions and operational benefits, making the Saudi Arabia real estate market increasingly appealing to global investors.
The Real Estate General Authority projects the market will reach $101.62 billion by 2029. Furthermore, growth is expected at 8 percent annually from 2024. Mega-projects, expanding tourism, and population growth will likely push real estate values in Saudi Arabia higher. Notably, retail and mixed-use developments will benefit the most.
Although growth slowed from the first quarter due to weaker residential gains, the outlook remains positive. Therefore, ongoing reforms, infrastructure projects, and private sector investment will likely sustain Saudi Arabia real estate prices momentum in the years ahead.
