Saudi Arabia Residential Construction Market Size (2024 - 2029)

The Saudi Arabia Residential Construction Market is experiencing significant growth, driven by extensive infrastructure and housing projects that align with the country's Vision 2030 strategy. Despite global economic challenges, the market's expansion is supported by increasing home ownership and a robust pipeline of unawarded projects. The Kingdom's construction sector, particularly in residential, cultural, and leisure sub-sectors, plays a crucial role in its economic diversification efforts. The market's resilience during the pandemic and the rising demand for smaller units further contribute to its positive outlook, bolstered by government initiatives to enhance the industry's economic impact.

Market Size of Saudi Arabia Residential Construction Industry

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Saudi Arabia Residential Construction Market Summary
Study Period 2020 - 2029
Base Year For Estimation 2023
Forecast Data Period 2024 - 2029
Historical Data Period 2020 - 2022
CAGR 6.00 %
Market Concentration Low

Major Players

Saudi Arabia Residential Construction Market Major Players

*Disclaimer: Major Players sorted in no particular order

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Saudi Arabia Residential Construction Market Analysis

The Saudi Arabia Residential Construction Market is valued at about USD 37 billion and is expected to register a CAGR of more than 6% during the forecast period. The market is driven by the infrastructure and housing projects developing in the country. Furthermore, the market is driven by the increasing home ownership in the country.

  • Despite global macroeconomic conditions, Saudi Arabia's construction industry continues to lead the MENA region. In 2022, the kingdom saw the highest value of project awards, demonstrating its commitment to driving economic diversification and transformation through its Vision 2030. The pipeline value of unawarded (pre-execution) projects in Saudi Arabia is estimated to be USD 1.1 trillion, which includes projects from the study stage to the main contractor bid. Approximately 70% of projects are in the 'construction' sector, with residential, cultural, leisure, and hospitality serving as sub-sector leaders, which is the driving force behind the Vision 2030 strategy. While the country's inflation forecasts are relatively soft in comparison to global averages, Saudi Arabia, like the rest of the MENA region, relies on importing construction materials from high inflationary countries, which affects construction material prices.
  • The Kingdom of Saudi Arabia is experiencing an unprecedented construction and urban mega-project boom that will reshape the Kingdom's and the region's future. The Public Investment Fund, the Royal Commissions of the major urban areas, the related Ministries, and the private sector, which is driving the majority of projects and opportunities, are all funding mega public and private sector projects. Exhibitors offering resilient, sustainable building technologies and solutions will have unprecedented access to new projects worth more than USD 2.9 trillion. Since its inception, The Housing Program has focused on setting new standards for the development of the housing sector to provide citizens with a variety of housing options. This assistance will increase the number of Saudi families who own a home.
  • The residential market was resilient during the pandemic, owing to strong demand fundamentals, and has seen a positive trend in KPIs in H1 2022. Apartment and/or smaller unit demand is increasing at a faster rate, owing to affordability, an influx of expatriates, and growing market acceptance for these types of units, particularly among Saudi households. The ongoing economic recovery, combined with improving demand drivers from various sectors, is expected to have a positive impact on the capital city's overall real estate market. Combining retail with other complementary real estate components such as entertainment, hotel, office, or residential could be a good idea for increasing footfall. The market's long-term outlook is likely to be positive, backed by the government's initiatives to increase the industry's contribution to the economy.

Saudi Arabia Residential Construction Industry Segmentation

Construction on single-family or two-family homes that are utilised, are planned to be used, or are predominantly used for residential purposes is considered residential construction. A complete background analysis of the Saudi Arabia Residential Construction Market, including the assessment of the economy and contribution of sectors in the economy, market overview, market size estimation for key segments, and emerging trends in the market segments, market dynamics, and geographical trends, and COVID-19 impact, is covered in the report.

The Saudi Arabia Residential Construction Market is segmented By Type (Apartments & Condominiums, Landed Houses & Villas, and Other Types), By Construction Type (New Construction, and Renovation), and By Key Cities (Riyadh, Jeddah, Dammam, and the Rest of Saudi Arabia). The report offers market size and forecast values (USD billion) for all the above segments.

By Type
Apartments & Condominiums
Landed Houses & Villas
Other Types
By Construction Type
New Construction
Renovation
By Key Cities
Riyadh
Jeddah
Dammam
Rest of Saudi Arabia
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Saudi Arabia Residential Construction Market Size Summary

The Saudi Arabia Residential Construction Market is experiencing significant growth, driven by extensive infrastructure and housing projects aligned with the country's Vision 2030 initiative. This vision aims to diversify the economy and transform the urban landscape, with a substantial pipeline of projects in various stages of development. The residential sector, along with cultural, leisure, and hospitality sub-sectors, plays a pivotal role in this transformation. Despite global economic challenges, Saudi Arabia's construction industry remains a leader in the MENA region, with a strong focus on increasing home ownership and providing diverse housing options to its citizens. The government's proactive policies and financial products are addressing key challenges in the housing market, making homeownership more accessible and stimulating demand for residential units.

The market is characterized by a robust demand for affordable housing, supported by initiatives to improve financing options and reduce barriers such as high mortgage interest rates. The involvement of the private sector in developing affordable housing solutions is also on the rise. Sustainable real estate development is becoming a key trend, with significant investments in green infrastructure and LEED-certified projects. The market is fragmented, with numerous local and regional players, alongside a few global entities, creating ample opportunities for new partnerships and projects. Recent developments, such as the East Albuhirat project in Jeddah and the Sedra community in Riyadh, highlight the ongoing expansion and diversification of residential offerings in the Kingdom.

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Saudi Arabia Residential Construction Market Size - Table of Contents

  1. 1. MARKET INSIGHTS DYNAMICS

    1. 1.1 Market Overview

    2. 1.2 Market Dynamics

      1. 1.2.1 Drivers

      2. 1.2.2 Restraints

      3. 1.2.3 Opportunities

    3. 1.3 Industry Value Chain / Supply Chain Analysis

    4. 1.4 Porters Five Forces Analysis

      1. 1.4.1 Threat of New Entrants

      2. 1.4.2 Bargaining Power of Buyers/Consumers

      3. 1.4.3 Bargaining Power of Suppliers

      4. 1.4.4 Threat of Substitute Products

      5. 1.4.5 Intensity of Competitive Rivalry

    5. 1.5 Current Economic Scenario and Consumer Sentiment

    6. 1.6 Residential Real Estate Buying Trends - Socio-economic and Demographic Insights

    7. 1.7 Government Initiatives and Regulatory Aspects for the Residential Real Estate Sector

    8. 1.8 Insights into Size of Real Estate Lending and Loan to Value Trends

    9. 1.9 Insights into Interest Rate Regime for General Economy and Real Estate Lending

    10. 1.10 Insights into Rental Yields in the Residential Real Estate Segment

    11. 1.11 Insights into Capital Market Penetration and REIT Presence in Residential Real Estate

    12. 1.12 Insights into Affordable Housing Support Provided by Government and Public-private Partnerships

    13. 1.13 Insights into Real Estate Tech and Startups Active in the Real Estate Segment (Broking, Social Media, Facility Management, and Property Management)

    14. 1.14 Impact of the COVID-19 Pandemic on the Market

  2. 2. MARKET SEGMENTATION

    1. 2.1 By Type

      1. 2.1.1 Apartments & Condominiums

      2. 2.1.2 Landed Houses & Villas

      3. 2.1.3 Other Types

    2. 2.2 By Construction Type

      1. 2.2.1 New Construction

      2. 2.2.2 Renovation

    3. 2.3 By Key Cities

      1. 2.3.1 Riyadh

      2. 2.3.2 Jeddah

      3. 2.3.3 Dammam

      4. 2.3.4 Rest of Saudi Arabia

Saudi Arabia Residential Construction Market Size FAQs

The Saudi Arabia Residential Construction Market is projected to register a CAGR of greater than 6% during the forecast period (2024-2029)

Saudi Cyprian Construction CO. LTD., Saudi Constructioneers Ltd. (Saudico), Jabal Omar Development Company, Sedco Development and Al Bawani are the major companies operating in the Saudi Arabia Residential Construction Market.

Saudi Arabia Residential Construction Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)