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The KSA real estate market: An overview

The Kingdom of Saudi Arabia’s National Transformation Programme, inspired by the Saudi Vision 2030, has brought about significant changes in the country’s real estate sector. The government's forward-thinking policies and strong initiatives to address the housing needs of the nation aim to enhance the quality of life of Saudi Arabian citizens, provide better access to housing, and create investment opportunities for stakeholders.

To this end, the Ministry of Municipal and Rural Affairs and Housing (MoMRAH) has made commendable strides in its efforts to make housing more accessible to the masses. It has introduced several products and initiatives, such as market-ready units provided by real estate developers or individual owners, access to financial institutions for housing support, and setting up a legal framework for housing programmes. For those who prefer to build their own homes, self-construction of units is also an option. Citizens can also receive support from contractors and land availability has been facilitated in all areas of the Kingdom. The housing sector has benefited immensely from this multi-dimensional ecosystem that has cemented the foundation for success in the housing sector.

The first half of 2023 has seen a significant increase in off-plan projects in Saudi Arabia, with a growth of 52 percent, compared to the same period last year. According to Wafi, KSA’s off-plan sales and leasing committee in MoMRAH, 47 off-plan sales projects received licences in the first half of 2023.

Owning a home is now a feasible possibility for a new generation of Saudis. Earlier, due to the shortage of supply in major cities such as Riyadh and Jeddah, property prices have historically been on the rise, putting home ownership out of reach for many.

But now, as the nation transforms, giga-projects such as Neom, are expected to create demand for 300,000 new homes for the Kingdom’s 9 million residents. Even sub-cities such as Oxagon, Sindalah, Trojena and The Line, along with projects from the National Housing Company (NHC) are collectively contributing to the development of over 140,000 residential units throughout the Kingdom. Under the government’s Housing Programme, the proportion of residential ownership aims to increase to 70 percent by 2030, providing affordable and quality housing for Saudi families and driving urban transformation.

According to H.E. Majed bin Abdullah Al-Hogail, “With the support of the Crown Prince, more than 100 million square metres in three cities have been designated to construct 300,000 residential units by 2025 in partnership with real estate developers.”

The paper explores the challenges and opportunities of the off-plan sector, and examines the attractive investment opportunities that it provides to contribute towards the country's home ownership targets set in the Vision 2030.