Prime Highlights:

Saudi Arabia’s real estate price index rose by 3.6% year-on-year in Q4 2024, driven primarily by the residential sector.

The residential sector recorded a 3.1% increase, with land plot prices rising by 2.5%, apartment prices up by 2.9%, and villa prices growing by 6.5%.

The Kingdom’s property market is projected to reach $69.51 billion in 2024 and $101.62 billion by 2029, with an 8% compound annual growth rate (CAGR).

Key Background:

Saudi Arabia’s real estate sector continued its upward trend in the fourth quarter of 2024, with the Kingdom’s real estate price index rising by 3.6% year-on-year, according to the General Authority for Statistics (GASTAT). This growth was primarily fueled by the residential real estate market, which saw a notable 3.1% increase compared to the same period in 2023.

The Real Estate Price Index, an essential indicator of property price changes across Saudi Arabia, revealed that residential properties played a pivotal role in this rise. Residential land plots, which make up 45.7% of the index, saw an increase of 2.5%, while apartment prices rose by 2.9%. Villa prices experienced the most substantial growth, climbing by 6.5%. However, residential floors registered a slight decrease of 0.7% year-on-year in Q4 2024.

This expansion in the real estate market is aligned with Saudi Arabia’s Vision 2030 objectives, which aim to establish the Kingdom as a global hub for tourism, business, and investment. The country’s property market is projected to reach $69.51 billion in 2024 and is expected to grow to $101.62 billion by 2029, with a compound annual growth rate (CAGR) of 8%.

While the residential sector experienced solid growth, the commercial real estate market also saw a positive performance, with prices increasing by 5% year-on-year. This rise was mainly driven by a 5.2% surge in commercial land plot prices. Commercial building prices grew by 5.1%, although prices for galleries and shops saw a decline of 1.7%. Additionally, agricultural property prices rose by 2.8%, compared to Q4 2023.

Regionally, the Riyadh area recorded the highest price growth, with an increase of 10.2% year-on-year. Other regions such as Najran and Tabuk saw price hikes of 4.6% and 1.1%, respectively. However, some areas experienced price declines, with Makkah seeing a 0.6% decrease and the Eastern Province reporting a 4.6% drop. In Al-Ahsa and Asir, real estate prices fell by 16.7% and 7.3%, respectively. In comparison to the third quarter of 2024, the real estate price index increased by 1.6% in Q4, with residential prices rising by 1%, while commercial property prices grew by 2.7%. Agricultural property prices, however, dropped by 9.8%. Overall, Saudi Arabia’s real estate market shows continued growth, supported by Vision 2030’s ambitious development goals.