Saudi Arabia Real Estate Market Size (2024 - 2029)

The Saudi Arabia real estate market is projected to experience significant growth over the forecast period, with its market size expanding considerably. The office sector, particularly in Riyadh, has shown robust demand, with Grade A office rental rates increasing and occupancy levels nearing full capacity. In Jeddah and the Eastern Province, similar trends are observed, with rising rents and improving occupancy rates. However, the residential sector faced a decline in transaction volumes, although average villa prices continued to rise in major cities. Overall, the market's expansion is driven by strong demand in the office sector and resilient pricing in residential properties.

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Market Size of Saudi Arabia Real Estate Industry

Saudi Arabia Real Estate Market Summary
Study Period 2020 - 2029
Base Year For Estimation 2023
Market Size (2024) USD 69.51 Billion
Market Size (2029) USD 101.62 Billion
CAGR (2024 - 2029) 8.00 %
Market Concentration Low

Major Players

Saudi Arabia Real Estate Market Major Players

*Disclaimer: Major Players sorted in no particular order

Saudi Arabia Real Estate Market Analysis

The Saudi Arabia Real Estate Market size is estimated at USD 69.51 billion in 2024, and is expected to reach USD 101.62 billion by 2029, growing at a CAGR of 8% during the forecast period (2024-2029).

The Saudi Arabia Real Estate Market size is expected to grow from USD 64.43 billion in 2023 to USD 94.19 billion by 2028, at a CAGR of 7.89% during the forecast period.

  • Saudi Arabia's office sector figures and occupier demand remained strong over the last quarter of 2022. This was particularly so in Riyadh, where stock levels remain anaemic at best and many upcoming developments are mostly fully pre-leased. Grade A offices in Riyadh saw average rental rates increase by 5.8% year-on-year increase in 2022, while Grade B rents rose by 1.5%. As for average occupancy rates, both Grades A and B stock saw occupancy levels improve slightly to 99.2% and 98.7% in 2022, marking annual increases of 0.8 and 1.9 percentage points respectively.
  • In Jeddah, Grade A office rents increased by 7.4% in the 12 months to December 2022, whereas Grade B rents remained unchanged. Occupancy rates for both Grade A and Grade B offices rose to reach 90.6% and 76.0%, up from 87.8% and 74.6% in 2021. In the Eastern Province, Dammam and Khobar's office markets saw Grade A rents increase by 7.9% and 6.2% respectively over the year to 2022, with Grade B rents remaining flat. Grade A occupancy levels in Dammam and Khobar at the end of 2022 stood at 81.2% and 78.7% respectively.
  • Residential transaction volumes in Saudi Arabia fell by 24.5% during 2022, compared to a year earlier. Overall, the number of residential transactions totalled 175,067 and the total value of these transactions stood at SAR 126.5 billion over this period, representing only a marginal decline of 3.7% year-on-year. On a regional level, we have seen total transaction volumes fall across the three major regions throughout 2022, where in Riyadh, Jeddah and the Dammam Metropolitan Area (DMA) total transaction volumes fell by 33.9%, 16.2% and 20.9% respectively. With regards to price performance in the residential sector, average villa prices in Riyadh, Jeddah and Dammam increased by 6.2%, 6.7% and 17.4% in 2022.

Saudi Arabia Real Estate Industry Segmentation

Real estate is the buying and selling of land and buildings, including any permanent manmade additions, such as houses and other buildings. The Saudi real estate market is segmented By Property Type (Residential Estate (Apartments, Villas) and Commercial Real Estate (Offices, Retail, Hospitality, and Others). The report offers market size and forecasts for the Saudi real estate market in value (USD) for the above segments.

By Property Type
Residential Real Estate
Apartments
Villas
Commercial Real Estate
Offices
Retail
Hospitality
Others
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Saudi Arabia Real Estate Market Size Summary

The Saudi Arabia real estate market is poised for significant growth, driven by robust demand in both the office and residential sectors. The office market, particularly in Riyadh, has shown strong performance with increasing rental rates and high occupancy levels, reflecting a sustained demand that outpaces supply. This trend is supported by the Kingdom's strategic initiatives under Vision 2030, which aim to attract multinational companies and enhance the local economy. The residential sector, while experiencing a decline in transaction volumes, is witnessing a rise in property prices, particularly in major cities like Riyadh, Jeddah, and Dammam. The government's commitment to building a substantial number of housing units in partnership with the private sector underscores its focus on meeting the growing housing demand.

The market landscape is characterized by intense competition, with both local and international developers vying for a share in this burgeoning market. The entry of international real estate companies highlights the market's potential and the need for adherence to global standards in property development. The Kingdom's regulatory framework, including mandates for foreign companies to establish local headquarters, further fuels the demand for high-quality office spaces. As the market evolves, developers are expected to adopt innovative strategies and practices to meet the increasing demand and maintain a competitive edge. The ongoing investments and strategic acquisitions by key players in the market reflect a proactive approach to capitalizing on the opportunities presented by Saudi Arabia's dynamic real estate sector.

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Saudi Arabia Real Estate Market Size - Table of Contents

  1. 1. MARKET DYNAMICS

    1. 1.1 Overview of the Economy and the Market

    2. 1.2 Impact of COVID-19 on the Market

    3. 1.3 Real Estate Buying Trends - Socioeconomic and Demographic Insights

    4. 1.4 Government Initiatives and Regulatory Aspects for the Residential Real Estate Sector

    5. 1.5 Insights Into Size of Real Estate Lending and Loan to Value Trends

    6. 1.6 Focus on Technology Innovation, Startups, and PropTech in Real Estate

    7. 1.7 Demand for and Supply of Real Estate in Saudi Arabia and Key Cities

    8. 1.8 Insights into Rental Yields in Real Estate Segment

    9. 1.9 Insights into Capital Market Penetration and REIT Presence in Real Estate

    10. 1.10 Insights Into Affordable Housing Support Provided by Government and Public-private Partnerships

    11. 1.11 Market Dynamics

      1. 1.11.1 Drivers

        1. 1.11.1.1 Growth in Commercial Activities and Increased Competition

        2. 1.11.1.2 Increasing Demand for Affordable Housing Units

      2. 1.11.2 Restraints

        1. 1.11.2.1 Lack of Housing Spaces and Mortgage Regulation can Create Challenges

      3. 1.11.3 Opportunities

        1. 1.11.3.1 Demand for Office Spaces is Likely to Increase Across Key Cities in Saudi Arabia

        2. 1.11.3.2 Ongoing Technological Advancements in the Construction Industry

  2. 2. MARKET SEGMENTATION

    1. 2.1 By Property Type

      1. 2.1.1 Residential Real Estate

        1. 2.1.1.1 Apartments

        2. 2.1.1.2 Villas

      2. 2.1.2 Commercial Real Estate

        1. 2.1.2.1 Offices

        2. 2.1.2.2 Retail

        3. 2.1.2.3 Hospitality

        4. 2.1.2.4 Others

Saudi Arabia Real Estate Market Size FAQs

The Saudi Arabia Real Estate Market size is expected to reach USD 69.51 billion in 2024 and grow at a CAGR of 8% to reach USD 101.62 billion by 2029.

In 2024, the Saudi Arabia Real Estate Market size is expected to reach USD 69.51 billion.

Saudi Arabia Real Estate Market Report Snapshots

Saudi Arabia Real Estate Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)