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Saudi Arabia’s Real Estate Sector Sees Record Growth Amid GCC Housing Surge
Real estate transactions in Saudi Arabia increased by 47% to $75.7 billion in 2024, contributing to a broader boom across the Gulf Cooperation Council.
Saudi Arabia's real estate market experienced significant growth in 2024, with transaction values surging 47 percent year-on-year to reach $75.7 billion, as reported by property consultancy Sakan.
This increase reflects heightened demand for housing and expansive urban development initiatives as the nation continues to implement its economic diversification strategies.
Across the Gulf Cooperation Council (GCC), total real estate transactions amounted to $383 billion, with Dubai leading the charge, accounting for 54 percent of the figure at $207 billion.
The ongoing expansion of the sector is largely fueled by population growth alongside government-backed infrastructure projects designed to reshape the urban landscape across the region.
Market projections indicate that the total value of the GCC's real estate sector is expected to reach approximately $4.67 trillion by 2025, according to data from Statista.
The regional economies, historically dependent on oil revenue, are increasingly channeling investments into property development as a means to diversify income sources and secure long-term economic stability.
Abdullah Al-Saleh, CEO of Sakan, emphasized, "With more than $383 billion in transactions, the GCC real estate market is on an unprecedented growth trajectory.
PropTech is no longer an option; it is a necessity."
The report also highlighted an anticipated rise in housing demand within Saudi Arabia, with projections showing the Kingdom will require an additional 800,000 housing units across Saudi Arabia, Kuwait, and Oman by 2030. Riyadh, central to this expansion, is projected to see its population grow to 9.6 million by the close of the decade, driven by a significant influx of expatriates and the Vision 2030 framework aimed at increasing homeownership.
Despite these optimistic growth forecasts, challenges surrounding affordability persist, exemplified by a reported 10.6 percent increase in house rents in 2024, indicative of mounting supply pressures.
An important trend influencing the Gulf's property market is the increasing likelihood of expatriates transitioning from renting to homeownership.
In Saudi Arabia, remittance outflows surged from $31.2 billion in 2019 to $38.4 billion in 2023, suggesting a greater financial commitment from the expatriate community.
Dubai is actively engaging this demographic by recently approving 457 plots for freehold conversion to attract expatriate buyers.
The influx of foreign professionals seeking long-term residence is bolstering the Saudi market, contributing to rising investor confidence, according to Sakan.
Currently, expatriates constitute 52 percent of the GCC’s population, and the implementation of residency incentives coupled with mortgage-friendly policies is further enhancing their participation in the real estate sector.
In the luxury real estate segment, Dubai has established itself as a frontrunner, with a reported 388 transactions exceeding $10 million during the 12-month period leading to the third quarter of 2024, the highest globally.
Saudi Arabia is concurrently expanding its luxury market with The Red Sea Project, which is attracting high-net-worth individuals.
Additionally, Qatar's Qetaifan Island North is emerging as a significant destination for ultra-luxury developments.
Sakan's report noted the growing appeal of branded residences—luxury homes affiliated with hotel brands—across the region, with the Middle East comprising 12 percent of global supply.
Dubai is notably leading this market, with 121 branded residence projects currently under development.
With projections indicating that 84.3 percent of the GCC population will reside in urban areas by 2030, there is expected to be sustained demand for both residential and commercial real estate.
Although affordability remains a pressing concern, government-backed initiatives, increasing foreign investor engagement, and evolving expatriate trends contribute to a market anticipated to maintain its growth momentum.
As Saudi Arabia and the UAE pursue ambitious mega-projects, the Gulf's real estate sector is solidifying its role as a pivotal component in the broader context of economic diversification.
This increase reflects heightened demand for housing and expansive urban development initiatives as the nation continues to implement its economic diversification strategies.
Across the Gulf Cooperation Council (GCC), total real estate transactions amounted to $383 billion, with Dubai leading the charge, accounting for 54 percent of the figure at $207 billion.
The ongoing expansion of the sector is largely fueled by population growth alongside government-backed infrastructure projects designed to reshape the urban landscape across the region.
Market projections indicate that the total value of the GCC's real estate sector is expected to reach approximately $4.67 trillion by 2025, according to data from Statista.
The regional economies, historically dependent on oil revenue, are increasingly channeling investments into property development as a means to diversify income sources and secure long-term economic stability.
Abdullah Al-Saleh, CEO of Sakan, emphasized, "With more than $383 billion in transactions, the GCC real estate market is on an unprecedented growth trajectory.
PropTech is no longer an option; it is a necessity."
The report also highlighted an anticipated rise in housing demand within Saudi Arabia, with projections showing the Kingdom will require an additional 800,000 housing units across Saudi Arabia, Kuwait, and Oman by 2030. Riyadh, central to this expansion, is projected to see its population grow to 9.6 million by the close of the decade, driven by a significant influx of expatriates and the Vision 2030 framework aimed at increasing homeownership.
Despite these optimistic growth forecasts, challenges surrounding affordability persist, exemplified by a reported 10.6 percent increase in house rents in 2024, indicative of mounting supply pressures.
An important trend influencing the Gulf's property market is the increasing likelihood of expatriates transitioning from renting to homeownership.
In Saudi Arabia, remittance outflows surged from $31.2 billion in 2019 to $38.4 billion in 2023, suggesting a greater financial commitment from the expatriate community.
Dubai is actively engaging this demographic by recently approving 457 plots for freehold conversion to attract expatriate buyers.
The influx of foreign professionals seeking long-term residence is bolstering the Saudi market, contributing to rising investor confidence, according to Sakan.
Currently, expatriates constitute 52 percent of the GCC’s population, and the implementation of residency incentives coupled with mortgage-friendly policies is further enhancing their participation in the real estate sector.
In the luxury real estate segment, Dubai has established itself as a frontrunner, with a reported 388 transactions exceeding $10 million during the 12-month period leading to the third quarter of 2024, the highest globally.
Saudi Arabia is concurrently expanding its luxury market with The Red Sea Project, which is attracting high-net-worth individuals.
Additionally, Qatar's Qetaifan Island North is emerging as a significant destination for ultra-luxury developments.
Sakan's report noted the growing appeal of branded residences—luxury homes affiliated with hotel brands—across the region, with the Middle East comprising 12 percent of global supply.
Dubai is notably leading this market, with 121 branded residence projects currently under development.
With projections indicating that 84.3 percent of the GCC population will reside in urban areas by 2030, there is expected to be sustained demand for both residential and commercial real estate.
Although affordability remains a pressing concern, government-backed initiatives, increasing foreign investor engagement, and evolving expatriate trends contribute to a market anticipated to maintain its growth momentum.
As Saudi Arabia and the UAE pursue ambitious mega-projects, the Gulf's real estate sector is solidifying its role as a pivotal component in the broader context of economic diversification.
