Saudi Arabia’s housing market is witnessing a surge in demand, with 72% of Saudis and expatriates expressing interest in homeownership, according to a new report. Knight Frank’s Saudi Report 2025 highlights that high-income nationals earning over SR50,000 ($13,300) monthly are leading the charge, with 93% actively seeking property purchases. The survey of 1,037 respondents—835 Saudis and 100 expatriates—reveals growing interest among expatriates as well, with 77% aspiring to own homes in the Kingdom.
Vision 2030 Homeownership Target Nears
Homeownership in Saudi Arabia reached 63.7% by 2023, nearing the government’s Vision 2030 target of 70%. However, affordability remains a hurdle, prompting some buyers to explore rental options. The total value of housing transactions in 2024 soared to SR267.8 billion across 236,690 sales, marking a 37% increase in transaction volume and a 27% rise in value compared to 2023.
The desire for homeownership is driven by investment opportunities, family-friendly communities, and access to quality housing. According to the survey, 48% of respondents cited a need for a primary residence, while 31% sought homes for their children or extended family. Major cities like Riyadh, Jeddah, and Dammam are experiencing significant price growth. In Riyadh, apartment prices surged 75% since 2019, while villa prices rose 40%. Jeddah saw a 53% jump in residential transactions in 2024, with total property values increasing by 43%.
Financing Strategies and Shifting Preferences
Knight Frank‘s report explains that nearly 58% of Saudi buyers rely on family support to fund purchases, while 40% use self-sought financing solutions. Mortgage-backed transactions are rising, fueled by government programs like Sakani and Dhamanat, which are improving access to loans. Meanwhile, housing preferences are evolving: over half of respondents prefer villas, particularly among higher-income Saudis. Townhouses and apartments are gaining traction among younger buyers and middle-income families.
While property ownership demand remains strong, rental demand is also growing. Younger Saudis and expatriates are increasingly opting for flexible living options due to rising prices. Riyadh and Jeddah dominate buyer preferences, with 54% favoring the capital.
Future Outlook: Balancing Growth and Affordability
Despite government efforts to boost supply, affordability challenges persist, especially for middle-income buyers. The report notes a mismatch between market pricing and buyers’ budgets, with the average four-bedroom villa in Riyadh costing SR2.8 million—above the SR750,000–SR2.5 million range most buyers’ target.
As Saudi Arabia nears its 70% homeownership target, affordability, rising prices, and shifting consumer preferences will shape the housing sector’s trajectory. With ongoing investments under Vision 2030, both homeownership and rental markets are poised for continued evolution.
