By Bernd Debusmann Jr
New data from CBRE shows growth across all the sub-sectors of Riyadh's property market
The volume of real estate transactions in Riyadh has increased by 53 percent year-on-year, while the value of transactions has gone up 63 percent, according to new data from real estate consultancy CBRE.
The data revealed residential mortgages for individuals in the kingdom saw a growth rate of over 250 percent in terms of the number of contracts signed between January 2019 and November 2019.
The figures also show the value of contracts rose by over 160 percent in the same period.
Additionally, CBRE’s data shows that the national rate of home ownership rose 14 percent in 2019 compared to 2018 as a result of the Saudi Ministry of Housing’s ‘Sakani’ initiative.
At the end of 2019, the capital’s residential supply stood at 1,290,000 residential units, with an expected delivery of 111,000 additional units by 2023.
The report also showed that total office stock in Saudi Arabia’s capital stood at 4.3 million square metres of gross leasable area (GLA) in Q4 2019, with an additional 1.66 million sq m of GLA expected to be delivered by 2023.
In terms of hotel supply, CBRE found that there are 17,700 keys in Riyadh, with another 4,500 keys expected to enter the market by 2023. Occupancy rose 5 percent year-on-year.
“The recent economic and social initiatives and legislation introduced by the Saudi government have already had an extremely positive impact on the country’s real estate sector,” Simon Townsend, head of strategic advisory at CBRE MENAT and general manager of CBRE KSA, said.
“We are already starting to witness impressive growth across major real estate segments including residential, hospitality and retail, and this upwards trajectory is likely to continue in the short to medium term,” he said. “Increased government spending on large-scale infrastructure and mega-projects is expected to further stimulate the overall market, with a positive trickling down effect on other complementary sectors.”