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Forecast Period
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2026-2030
|
|
Market Size (2024)
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USD 42 Billion
|
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Market Size (2030)
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USD 66 Billion
|
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CAGR (2025-2030)
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7.91%
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Fastest Growing Segment
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Townhouses
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Largest Market
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Riyadh
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Market Overview
Saudi Arabia Residential Real Estate
Market was valued at USD 42 Billion in 2024 and is expected to reach USD 66 Billion
by 2030 with a CAGR of 7.91% during the forecast period.
Residential real estate refers to properties that are
used primarily for living purposes rather than for commercial or industrial
use. These properties include single-family homes, condominiums, townhouses,
duplexes, and multi-family apartment buildings. Residential real estate may be
owner-occupied or rented out to tenants, and it plays a fundamental role in
providing shelter and personal space for individuals and families.
This type of real estate is influenced by several
factors such as location, neighborhood amenities, school districts, and
proximity to transportation. Economic conditions, interest rates, and housing
policies also significantly affect demand and property values in the
residential market.
Residential real estate can be newly constructed homes
or existing structures that are bought and sold through real estate
transactions. It often represents one of the largest financial investments
individuals make during their lifetime. Buyers typically consider long-term
needs, lifestyle, and affordability when purchasing residential property.
Investors may also participate in the residential
market to generate rental income or to resell properties for profit, often
through renovations or market timing. In essence, residential real estate is a
key component of both personal wealth and the broader economy, serving as a
cornerstone of human habitation and community development.
Key Market Drivers
Demographics and
Population Growth
Saudi Arabia’s residential real estate market is
significantly driven by its demographic profile. The Kingdom has a young and
rapidly growing population, with over 60% of its citizens under the age of 35.
This youthful population is increasingly seeking independence, higher living
standards, and better housing options, which directly fuels demand in the
residential sector. Saudi Arabia's population has experienced steady
growth, with the current population estimated at over 35 million people as of
2024. The population is expected to continue growing at a rate of about 1.5%
per year. By 2030, the population could exceed 40 million.
Urbanization is another critical factor. As people
continue to migrate from rural areas to major cities like Riyadh, Jeddah, and
Dammam in search of education and employment, urban housing needs have surged.
This has created both challenges and opportunities for developers and
policymakers. Moreover, there is a growing trend of smaller family units and a
shift in lifestyle preferences. Many younger individuals are choosing to live
in apartments or townhouses rather than traditional large family homes. This shift
is influencing the design and layout of new residential developments.
The government’s focus on increasing
homeownership—targeting 70% ownership by 2030—is closely tied to these
demographic changes. With the introduction of financial tools such as mortgage
facilities, home financing has become more accessible, allowing young people to
enter the housing market earlier than in previous generations.
This growing and evolving population ensures sustained
long-term demand for residential units across various segments—from affordable
housing to luxury developments—making demographics one of the most powerful and
consistent drivers in the Saudi housing market.
Economic Diversification and Employment Growth
As Saudi Arabia moves forward with economic
diversification under Vision 2030, new sectors such as tourism, entertainment,
logistics, and technology are rapidly expanding. This diversification is
creating a wide range of job opportunities and attracting both local and
international talent, thereby stimulating housing demand across multiple
regions of the Kingdom.
New economic zones and business hubs are being
developed to host emerging industries. Projects such as NEOM and King Abdullah
Economic City are expected to generate thousands of jobs, attracting workers
and their families, which naturally increases the need for residential housing.
These areas are being designed with integrated living and working environments,
where housing developments are a key part of infrastructure planning.
As employment rises, individuals gain more financial
security and are more likely to invest in property, particularly as
homeownership remains a cultural aspiration in Saudi Arabia. Furthermore, with
an increasing number of dual-income households, the purchasing power of Saudi
families is also rising, allowing them to explore various types of residential
real estate, from starter homes to more luxurious villas.
Foreign investment is another aspect to consider. As
new industries grow, the government is easing ownership restrictions for
non-Saudis, allowing them to purchase properties under certain conditions. This
is opening new avenues for real estate developers and adding to the demand in
premium housing segments. As
part of the Vision 2030 plan, the government is focusing on expanding the
private sector. Non-oil sectors are projected to contribute around 50% of the
GDP by 2030, compared to just 25% in 2020. This diversification strategy is
anticipated to lead to a broad expansion of employment opportunities beyond
traditional oil-based industries.
In essence, economic diversification is laying the
foundation for a robust and sustainable residential property market. As more
sectors grow and employment becomes more widespread, the housing market is
expected to expand in both scale and sophistication, accommodating a broader
range of buyers and renters.
Infrastructure Development and Urban Planning
Infrastructure development and modern urban planning
play a crucial role in shaping Saudi Arabia’s residential real estate
landscape. The government has invested heavily in transportation networks,
utilities, and digital infrastructure to support the growth of urban areas and
accommodate population increases.
New roads, metro systems (such as the Riyadh Metro),
and airport expansions are making suburban and satellite towns more accessible,
encouraging developers to construct residential communities in previously
underdeveloped areas. These improvements reduce commute times and enhance the
attractiveness of housing developments located outside city centers. Moreover,
the introduction of smart city concepts and sustainable urban planning is
changing how residential areas are designed. Cities like NEOM and the Red Sea
Project are being built with futuristic infrastructure, energy-efficient
housing, and integrated digital services. These innovations not only attract
higher-income buyers but also set new standards for residential living across
the country.
Government planning agencies are also focusing on
creating livable communities with access to schools, healthcare, retail
centers, and green spaces. This integrated approach to planning supports
long-term community development and increases the value of residential
properties. The
Saudi government has allocated over USD 26 billion for infrastructure and urban
development projects across the Kingdom.
As infrastructure expands, real estate developers are
better positioned to respond to housing demand with projects that are
well-connected, environmentally sustainable, and aligned with modern
lifestyles. This coordinated approach ensures that residential growth is not
only fast-paced but also thoughtfully managed to serve the needs of future
generations.
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Key Market Challenges
Affordability and Accessibility of Housing
One of the most pressing
challenges in Saudi Arabia’s residential real estate market is housing
affordability, especially for low- and middle-income citizens. While the
government has introduced initiatives like the Sakani program to promote
affordable housing, a significant portion of the population still struggles to
access homes that match their financial capacity.
The gap between income
levels and housing prices remains considerable in many urban areas. As cities
like Riyadh, Jeddah, and Dammam continue to develop, land values and
construction costs rise, pushing the prices of residential units higher. For
many young Saudis and newly formed households, homeownership remains out of
reach despite mortgage support and financial assistance programs. Additionally,
although banks and real estate developers are offering more mortgage products,
strict lending criteria can prevent those without strong credit histories or
stable employment from qualifying. This is particularly challenging for
informal workers or those employed in sectors with fluctuating incomes.
There is also a mismatch
between supply and demand. While high-end and luxury housing developments have
grown rapidly, the supply of truly affordable units has lagged behind.
Developers often prioritize higher-margin projects over low-cost housing, resulting
in a lack of options for the majority of the population. Furthermore,
inflationary pressures, rising interest rates, and increasing construction
costs compound the issue, making it difficult for developers to deliver
affordable housing at scale. Even when such projects are announced, delays in
approvals, infrastructure provisioning, or financing can hinder timely
delivery.
Addressing affordability
will require more than financial subsidies; it will necessitate policy reforms,
stronger public-private partnerships, and incentives for developers to focus on
mid- to low-income housing. Without a sustainable solution to housing
affordability, the market risks alienating a large portion of the population,
weakening homeownership rates and slowing overall real estate growth.
Regulatory Complexity and Bureaucratic Delays
Another significant
challenge in the Saudi residential real estate market is the complex regulatory
environment and bureaucratic delays that developers and buyers often encounter.
Despite ongoing reforms under Vision 2030 to streamline processes and improve
transparency, navigating the regulatory framework can still be slow and
cumbersome.
Obtaining permits for
construction, zoning, and land development often involves multiple layers of
approval from different government agencies. This complexity can lead to
project delays, increased development costs, and uncertainty, especially for
smaller developers or international investors unfamiliar with local procedures.
Moreover, inconsistencies in land registration and title documentation continue
to pose challenges. While the government has made strides in digitizing land
records and improving the reliability of property titles, issues still arise
around land ownership disputes, unclear zoning regulations, and overlapping
jurisdictional authority.
These bureaucratic hurdles
not only slow down housing development but also create an uneven playing field.
Larger, well-connected developers may find it easier to navigate the system,
while smaller firms and foreign investors may be discouraged due to the time,
cost, and risk involved.
Another regulatory concern
is the implementation of real estate transaction taxes and fees. While these
measures are intended to curb speculation and stabilize prices, they can also
deter transactions and reduce market liquidity if not managed carefully.
The lack of a unified
regulatory body to oversee all real estate-related matters contributes to these
challenges. While agencies like the Real Estate General Authority (REGA) and
the Ministry of Municipal and Rural Affairs are working to address these issues,
overlapping responsibilities often result in confusion and inefficiencies.
To overcome these
challenges, Saudi Arabia needs to continue simplifying its real estate
regulations, reduce approval times, and enhance transparency in all
transactions. Introducing digital platforms for faster permit issuance, clear
zoning laws, and standardized building codes can make the market more efficient
and investor-friendly. Without such reforms, the residential real estate sector
may struggle to meet the country’s growing demand for housing in a timely and
cost-effective manner.
Key Market Trends
Shift Toward Homeownership and Mortgage Expansion
One of the most noticeable trends in the Saudi
residential real estate market is the growing shift toward homeownership,
supported by an expanding mortgage market. In line with Vision 2030’s goal of
increasing the homeownership rate to 70% by the end of the decade, the
government has introduced a range of initiatives to make purchasing homes more
attainable.
Financial institutions have responded with more
flexible mortgage offerings, including lower down payment options, longer
repayment terms, and government-backed loans. Programs like Sakani and the Real
Estate Development Fund (REDF) offer subsidized loans to qualified Saudi
citizens, making it easier for young families and first-time buyers to enter
the market.
The Saudi Central Bank (SAMA) has also revised
regulations to encourage lending, improving credit accessibility and
encouraging competition among banks. As a result, the volume of residential
mortgages has seen double-digit growth year-on-year.
This shift is not only increasing home sales but also
shaping consumer behavior. Buyers are now more informed and willing to commit
to long-term investments in property. Developers, in turn, are adapting their
strategies to offer more units in the affordable and mid-range segments to meet
this rising demand.
Rise of Integrated and Master-Planned Communities
Another emerging trend in Saudi Arabia’s residential
real estate market is the development of integrated, master-planned
communities. These large-scale residential projects are designed to offer not
just homes, but a complete lifestyle—combining housing with schools,
healthcare, retail, recreational spaces, and even business centers.
This approach addresses the increasing demand for
convenience, community, and quality of life, particularly among younger
families and professionals. As urban congestion grows in major cities like
Riyadh and Jeddah, residents are seeking alternatives that offer a balanced and
self-sufficient living environment.
Master-planned communities such as King Abdullah
Economic City (KAEC), Sedra by ROSHN, and the ROSHN-backed projects in several
cities, are designed with walkability, sustainability, and smart technologies
in mind. These developments also often include modern amenities like fitness
centers, parks, and cultural venues, appealing to a lifestyle-oriented
generation.
Government support for such projects is strong, with
land being allocated and infrastructure being built to attract private
investment. Additionally, these communities are being integrated into broader
national initiatives like the Public Investment Fund’s (PIF) urban development
strategy, ensuring alignment with long-term economic and population growth
plans.
This trend is redefining what residential living looks
like in the Kingdom and is likely to become the new standard in urban planning
and real estate development.
Segmental Insights
Type Insights
The New Construction held the largest
market share in 2024. New construction
dominates the Saudi Arabia residential real estate market due to a combination
of strategic government initiatives, demographic trends, and evolving consumer
preferences. At the forefront of this shift is the government’s Vision 2030, which
aims to diversify the economy and increase the homeownership rate to 70% by
2030. As part of this vision, substantial investments have been directed toward
the development of new housing, particularly through programs like Sakani and
support from the Real Estate Development Fund (REDF). These initiatives
prioritize the creation of affordable and accessible homes, encouraging both
local and international developers to launch large-scale residential projects.
Demographics also play a critical role. Saudi Arabia
has a young and rapidly growing population, with a strong demand for housing
tailored to modern lifestyles. Younger generations are increasingly seeking
properties that offer updated amenities, smart technologies, and integrated
community living—features that are more easily incorporated into new
developments than existing housing stock. Additionally, urban expansion is
creating opportunities to build new communities in previously undeveloped
areas, particularly around major cities such as Riyadh, Jeddah, and Dammam.
Projects like ROSHN communities and NEOM are leading examples of this trend,
offering sustainable and technologically advanced housing options that appeal
to both middle-class families and high-income buyers.
From a regulatory and economic standpoint, the
government has streamlined land allocation, improved infrastructure, and
provided financing incentives to developers, making new construction more
feasible and profitable. Meanwhile, the resale market remains limited due to an
older housing inventory, legal challenges in property transfers, and less
desirable locations.
Category Insights
The Flats & Apartments held the
largest market share in 2024. Flats and
apartments have become a dominant segment in the Saudi Arabian residential real
estate market due to a combination of demographic, economic, and urban planning
factors. One of the key drivers is the rapid urbanization and population
growth, especially in major cities like Riyadh, Jeddah, and Dammam. As land
availability in central urban areas becomes limited, vertical housing solutions
such as apartments offer a practical and space-efficient alternative.
Another major influence is the changing lifestyle
preferences of younger Saudis. With over 60% of the population under the age of
35, there is a growing demand for modern, low-maintenance housing options that
suit the needs of smaller households and working professionals. Apartments
often come with amenities such as security, parking, and recreational
facilities, which are attractive to this demographic. Affordability also plays
a significant role. Compared to villas or standalone homes, flats and apartments
are typically more affordable, making them accessible to first-time buyers and
middle-income families. The government’s push to increase homeownership through
subsidized financing programs has further supported this trend, as many such
programs are aligned with the development of high-density, affordable housing.
From a development perspective, apartments allow for
quicker construction and higher unit yield per land parcel, making them more
attractive to real estate developers, particularly in urban centers. This
aligns with Vision 2030’s goals of efficient land use and sustainable city
planning. Additionally, new master-planned communities often integrate
apartment living as part of their design, supporting mixed-use development and
reducing urban sprawl. As cities continue to modernize, the demand for
well-located, community-focused apartment living is expected to grow,
solidifying flats and apartments as a cornerstone of Saudi Arabia’s residential
real estate market.
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Regional Insights
Riyadh held the largest market share in
2024. Riyadh is the political, economic, and administrative heart of Saudi
Arabia. As the largest city in the Kingdom, it hosts numerous government
institutions, corporate headquarters, and international businesses. This
concentration of economic activity draws a steady influx of residents, from
Saudi nationals to expatriates, seeking employment and opportunities in diverse
sectors such as finance, healthcare, education, and technology.
Riyadh’s population has been rapidly
growing due to both natural increase and migration from other parts of Saudi
Arabia and abroad. As the Kingdom’s most populous city, Riyadh is experiencing
heightened demand for residential properties, ranging from affordable housing
for young families to high-end luxury homes for executives and expatriates.
Riyadh’s rapid urbanization is further
accelerated by government initiatives aimed at improving the city’s
infrastructure. Major projects like the Riyadh Metro, road networks, and other
urban amenities have made the city more accessible, improving the quality of
life and attracting more residents. These developments have spurred both
residential and commercial real estate growth, making Riyadh a central hub for
investment.
As a part of Saudi Arabia’s Vision 2030
plan, Riyadh is a focal point for future growth and diversification. The city
is set to become a global financial center and a model for sustainable living.
Projects such as the King Abdullah Financial District and Riyadh Green aim to
position Riyadh as a leading city in terms of livability, sustainability, and
economic diversification, further driving residential demand.
Recent Developments
- In January 2025, Square One, a leading real estate
marketing agency in India, launched two innovative software solutions—Blackboxx
Real and Blackboxx VR. These advanced platforms offer immersive 3D and virtual
reality experiences that revolutionize property presentations, allowing
potential buyers to engage more deeply, interact seamlessly, and explore
properties in a way that simplifies the sales process.
- In August 2024, Godrej Properties Limited (GPL), one
of India’s top real estate developers, introduced its groundbreaking campaign, WhereTrustResides.
This initiative acknowledges that purchasing a home is a significant life
decision, with buyers often seeking brands that have established trust and
credibility over time. While the demand for luxurious lifestyles, designer
homes, and premium amenities continues to rise, the most important factor for
buyers remains the trustworthiness of the brand.
Key Market Players
- Christie International Real Estate
- ColdWell Banker Real Estate Company
- Al Habtoor Group
- DLF Ltd
- Hochtief Corporation
- IJM Corporation Berhad
- Engel & Volkers AG
- Lennar Corporation
- Raubex Group Ltd
- Pultegroup Inc.
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By Type
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By Category
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By Mode
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By Region
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|
|
- Flats & Apartments
- Individual Houses or Private Dwellings
- Condominium
- Townhouses
- Others
|
|
- Riyadh
- Makkah
- Madinah
- Eastern Province
- Dammam
- Rest of Saudi Arabia
|
Report Scope:
In this report, the Saudi Arabia Residential
Real Estate Market has been
segmented into the following categories, in addition to the industry trends
which have also been detailed below:
- Saudi
Arabia Residential
Real Estate Market, By Type:
o New Construction
o Resale
- Saudi
Arabia Residential
Real Estate Market, By Category:
o Flats & Apartments
o Individual Houses or Private Dwellings
o Condominium
o Townhouses
o Others
- Saudi
Arabia Residential Real Estate Market, By Mode:
o Online
o Offline
- Saudi
Arabia Residential Real Estate Market, By Region:
o Riyadh
o Makkah
o Madinah
o Eastern Province
o Dammam
o Rest of Saudi Arabia
Competitive Landscape
Company Profiles: Detailed analysis of the major companies
present in the Saudi Arabia Residential Real Estate Market.
Available Customizations:
Saudi Arabia Residential Real Estate Market report
with the given market data, TechSci Research offers customizations according
to a company's specific needs. The following customization options are
available for the report:
Company Information
- Detailed analysis and
profiling of additional market players (up to five).
Saudi Arabia Residential Real Estate Market is an upcoming
report to be released soon. If you wish an early delivery of this report or
want to confirm the date of release, please contact us at sales@techsciresearch.com