01 Sep 2024
RIYADH: Saudi Arabia witnessed a 38 percent rise in real estate transactions during the first half of the year, reaching 106,700 deals with a total value of around SR127.3 billion ($33.9 billion), according to Knight Frank.
A report by the London-based global real estate consultancy firm said that residential transactions comprised 61 percent of all property deals by total value and saw a 41 percent increase, reaching just under 91,860 sales.
Concurrently, the value of these residential transactions surged by 48 percent, totaling SR77.6 billion over the same period.
The analysis underscored several factors that have driven the growth in residential real estate transactions in the Kingdom.
In 2023, Saudi Arabia’s Housing Program supported over 96,000 families by providing access to affordable home financing solutions. Additionally, more than 20,000 households received assistance through the Development Housing Program, run by the Ministry of Municipalities and Housing.
The initiative facilitates homeownership for eligible families and provides usufruct rights to homes donated through the government’s housing support portal.
The report attributes the surge in demand for residential properties to the Kingdom’s housing programs, government initiatives promoting affordability, and public and private partnerships.
Riyadh continues to stand out among Saudi Arabia’s major cities, bolstered by government initiatives aimed at enhancing its economic, cultural, and entertainment appeal.
Undertakings like Programme HQ fuel residential demand as businesses expand and regional headquarters relocate to the capital.
Over the past year, residential transaction volumes in Riyadh surged by 49 percent, outpacing Jeddah at 27 percent, Dammam Metropolitan Area at 29 percent, and Madinah at 21 percent. Makkah was the only city where transaction volumes declined by 6 percent.
The analysis also said that government initiatives aimed at increasing housing supply and affordability have significantly boosted sales activity this year.
The launch of various housing projects, such as those under the Sakani and Wafi programs, have been pivotal in promoting homeownership among Saudi nationals, with these efforts now extending to secondary and tertiary cities across the country.
By the close of 2023, Saudi homeownership rose to 63.74 percent, reflecting a 16.7 percentage point increase since 2016 when the National Transformation Plan was launched, exceeding the government’s 2023 goal of 63 percent set by the Ministry of Municipalities and Housing.
The introduction of regulations permitting foreign investors to purchase property in Saudi Arabia through the new Premium Residency Visa options, unveiled in January, has expanded the market to international buyers and further increased demand.