Riyadh’s residential property prices have increased by up to 60 per cent in just six months, according to Realiste.
Over the past few years, real estate has emerged as a top priority for the local government in response to the swiftly changing demographics of Saudi Arabia.
The country’s population has surged by more than 20 percent from 1970 to 2020, with more than half of its citizens under the age of 30.
Riyadh real estate
Many of these young people migrate from rural areas to cities in search of employment opportunities. It is expected that Riyadh, the capital of the Kingdom, will see the addition of 100,000 new homes by the end of 2023.
In an effort to reduce the country’s reliance on revenue generated from oil, the government is also pursuing its Vision 2030 plan, which aims to transform the country’s economy.
This plan, combined with the increasing demand for housing, has spurred investments in several new futuristic cities.
By 2030, the Kingdom is planning to build eight new megapolises, Including Neom, Qiddiya, Red Sea Project, Amaala, Al-Ula, Diriyah Gate, and others.
Investment in these projects accounted for almost $575bn. This funding will allow the development of 1.3m housing units.
The construction boom in Saudi Arabia has had an impact on property prices in Riyadh.
According to AI-powered research from Realiste, property prices have risen by 9 per cent in the past six months, with some districts seeing increases of up to 60 per cent.
Notably, the districts of Al Naseem and Al Hamra have experienced the most growth, with a 56 and 52 per cent increase in prices, respectively.
Al Nakheel has also seen a significant rise of 40 per cent. Other districts in the top five for growth over the same period include Hijrat Laban (26 per cent) and Al Nafil (25 per cent).
Currently, the most expensive areas of Dubai are Al Nakheel, Al Rabee, and Al Malga with average property prices ranging from SR7,962 to SR10,254 per square meter.
The most affordable housing options are located in Al Badi’ah, Al Dar Al Baida, and Al Shifa, Realiste’s AI reveals.
In the next ten years, the property market in Saudi Arabia will be growing at a rocket pace. One of the factors behind this growth is establishing Riyadh as a new hub for innovation in the MENA region.
Last year Saudi Arabia announced more than $6.4bn in investments in future technologies and entrepreneurship as a part of its diversification plans.
That can secure its desired position as the MENA region’s leader in digital transformation.
Saudi Arabia is also easing regulations towards expats, including visa rules, to attract more foreigners to Riyadh and across the Kingdom.
The country aims to double the inflow of foreign direct investment by more than 18 times during the upcoming decade and gain SR388bn ($103bn) annually.
Realiste co-founder Alex Galtsev said: “We see more interest towards the Saudi market from investors. We expect that those who will buy 10, 20, apartments in Saudi and leave it for five years, will be able to come back and see them grow by 100, 200 percent over that period”.
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