Is Saudi Arabia’s real estate market good for sales?

Updated: February 2025

Saudi Arabia’s real estate market is on the cusp of a transformation. Over the past decade, the nation has undergone significant shifts, from economic diversification under Vision 2030 to ambitious mega-projects reshaping the urban landscape. These changes represent opportunities for investors and real estate professionals.

This blog post will explore the story behind this growth, the challenges to be overcome, and why now may be the ideal time to capitalise on the market’s potential.

Overview of the 2025 real estate market in Saudi Arabia

As part of Vision 2030, Saudi Arabia is undergoing a historic transformation to diversify its economy and embrace sustainable development. Real estate is at the heart of this plan, with ambitious projects and technologies reshaping the nation’s urban and economic landscape. In 2025, these efforts are driving remarkable growth and innovation in the real estate sector. Key highlights include:

• Urban Expansion: Rapid urbanisation in cities like Riyadh and Jeddah is boosting demand for diverse residential and commercial developments.
• Technological Integration: PropTech adoption, including virtual tours and AI-driven analytics, is enhancing property transactions and management.
• Sustainability Efforts: Developers are prioritising eco-friendly construction, aligning with Vision 2030 goals and global green building standards.
• Sectoral Growth: Hospitality and logistics sectors are thriving, spurred by mega-projects like NEOM and the Red Sea Project, alongside increased demand for industrial properties.

Saudi Arabia’s real estate market in 2025 is full of opportunity. From residential to commercial and tourism sectors, the growth is undeniable. Vision 2030 continues to drive change, with sustainability and innovation at its core. Whether you're an investor, developer, or buyer, there’s potential for success in this dynamic market. The future of Saudi real estate is bright, and it’s just getting started.

How Saudi Arabia's housing market rebounded after the pandemic

Building on the expansive growth and transformation shaping Saudi Arabia’s real estate market, it’s essential to understand how resilience has played a crucial role in its current success. A significant factor has been the market’s ability to rebound strongly following the challenges posed by the COVID-19 pandemic. Residential sales volumes dropped, and new projects were delayed as consumer confidence waned. However, the market has shown strong signs of recovery, particularly from 2023 onwards, driven by improved economic conditions and strategic government initiatives.

In December 2023, new residential sales increased by 4.4%. This uptick was supported by rising oil prices, which boosted consumer spending and renewed interest in property investments. 

Additionally, government policies aimed at stimulating the Saudi Arabia housing market, such as tax exemptions for first-time home buyers and relaxed mortgage regulations, have helped boost this critical sector. With new developments like NEOM and The Red Sea Project, demand has risen substantially, attracting local and foreign investors looking for high-quality residential properties.

Despite the initial setback caused by the pandemic, the housing market in Saudi Arabia is now on an upward swing, with increased residential sales, rising property values, and strong demand for new housing units expected to continue through 2025. 

Why Invest in Saudi Arabia's real estate market in 2025

The resilience of Saudi Arabia’s housing market has set a strong foundation for broader opportunities in 2025. With the market rebounding and major developments underway, investors are now positioned to take advantage of a thriving real estate landscape.

Below, we highlight key reasons why 2025 presents a compelling case for property investment in Saudi Arabia. Key reasons to invest include:

• Vision 2030’s transformative impact: Ambitious mega-projects like NEOM and The Red Sea Project are reshaping urban living, tourism, and infrastructure, driving demand for high-quality real estate.
• Booming urbanisation: Rapid development in cities like Riyadh and Jeddah is increasing the demand for diverse residential and commercial properties, creating opportunities for growth in key urban centres.
• Sustainability-focused developments: Developers are prioritising eco-friendly projects aligned with global green building standards, ensuring future-proof investments.
• Technological integration: Innovations like PropTech, AI-driven analytics, and virtual tours streamline property transactions, enhancing investor confidence and efficiency.
• Robust infrastructure upgrades: Projects like the Riyadh Metro and Jeddah Tower highlight Saudi Arabia’s commitment to modernisation, improving connectivity and boosting the value of nearby properties.
• Favourable investment environment: With improved policies, foreign investors have easier access to property markets, while initiatives like Qiddiya and Amaala attract international interest and drive sectoral growth.
• Diverse sectoral opportunities: From residential to commercial and hospitality sectors, the market caters to a broad range of investment interests, including high-demand areas such as entertainment, wellness, and logistics.

The combination of government-led initiatives, cutting-edge infrastructure, and strategic market developments positions Saudi Arabia as a prime real estate investment destination in 2025. With a strong focus on innovation, sustainability, and global appeal, the time to capitalise on this dynamic market is now.

The role of Vision 2030 in transforming Saudi Arabia’s real estate sector

Saudi Arabia’s economic recovery has set the stage for transformative initiatives under Vision 2030, reshaping the real estate sector. It features numerous public and private partnerships focused on boosting the Saudi Arabia real estate market. Here are the major projects and developments shaping the future of the sector:

• NEOM: A $500 billion mega-city project designed to revolutionise urban living. NEOM will feature advanced infrastructure, including the futuristic "Line" city concept, residential, commercial, and industrial zones. The project is progressing rapidly, with residential areas set to open by 2026.
• The Red Sea Project: A luxury tourism hub that will offer 10,000 hotel rooms, an international airport, yacht berths, and various hospitality amenities. The first phase is expected to be completed by 2025, making it a key driver of growth in the hospitality and real estate market Saudi Arabia.
• Qiddiya: Positioned as a premier entertainment destination, Qiddiya will host a Six Flags theme park, hotels, and leisure facilities. It aims to boost domestic tourism and is projected to open its first phase by 2025, enhancing the commercial real estate sector.
• Amaala: A luxury wellness retreat focused on health and sustainability. It will feature retail stores, high-end hotel rooms, villas, an airport, marinas, and art galleries. The project is set for full completion by 2028, catering to the increasing demand for luxury residential properties.
• Diriyah Gate: This cultural and historical development is transforming the Diriyah district in Riyadh. It will include luxury residential units, retail spaces, and hospitality offerings, attracting both local and foreign investors to the area.

Additional infrastructure projects boosting real estate in Saudi Arabia

To complement these large-scale developments, Saudi Arabia is investing heavily in infrastructure upgrades, which are expected to further stimulate the Saudi Arabia housing market:

• Riyadh Metro: A state-of-the-art transit system designed to enhance urban mobility and reduce traffic congestion, set to significantly impact residential and commercial real estate near transit hubs.
• Jeddah Tower: Once completed, this will be the tallest building in the world, symbolising Saudi Arabia’s commitment to ambitious architectural projects and boosting the surrounding commercial property market.
• Expansion of the Makkah Grand Mosque: This project aims to accommodate the growing number of pilgrims visiting Mecca, indirectly supporting the demand for hospitality and residential developments in the region.
• King Salman Energy Park (SPARK): A massive industrial project aimed at creating a global energy hub, expected to drive demand for commercial and residential properties in the surrounding areas.
• King Abdullah Bin Abdulaziz Medical Complexes: Enhancements to healthcare infrastructure, including expanded medical facilities, are expected to increase the need for residential developments for healthcare professionals.

These projects and infrastructure upgrades reflect the Saudi government’s commitment to reshaping the urban landscape.

Commercial real estate in 2025: Overcoming challenges and seizing opportunities

As Saudi Arabia embarks on ambitious projects under Vision 2030, the ripple effects are becoming increasingly evident across all sectors, including commercial real estate. With a growing demand for new spaces and modern infrastructure, the commercial market is adapting to meet the evolving needs of businesses and investors.

 Here’s an updated look at the current challenges and emerging opportunities for 2025:

• Demand for flexible spaces: The Saudi Arabian co-working office spaces market is projected to experience a compound annual growth rate (CAGR) of more than 6% from 2022 to 2027. This growth is driven by increasing demand for flexible working environments from entrepreneurs, start-ups, and freelancers.
• Retail recovery: After initial struggles due to e-commerce, community malls are rebounding. Retail vacancy rates in Riyadh and Jeddah have dropped thanks to rising consumer spending.
• Challenges in leasing: Older office spaces face high vacancy rates (around 25%), as businesses prefer modern, energy-efficient buildings.
• Mixed-use and hospitality growth: Integrated developments combining residential, retail, and office spaces are on the rise. Hotel occupancy rates are approaching pre-pandemic levels, especially in tourism hubs.
• Government support: Vision 2030 initiatives and new investor visas are boosting commercial real estate growth, attracting both local and foreign investment.

Overall, the Saudi Arabia real estate market is adapting well, with promising trends in flexible spaces and mixed-use projects supporting the sector's recovery.

Maximising opportunities in Saudi Arabia’s real estate market

The real estate market in Saudi Arabia is showing strong signs of resilience and growth, fuelled by ongoing economic reforms and Vision 2030 initiatives. With increasing demand for residential properties, new infrastructure projects, and a steady rebound in the commercial sector, now is a promising time for investors looking to enter or expand in the region.

Whether you are targeting residential, commercial, or mixed-use developments, the outlook for 2025 suggests a wealth of opportunities, supported by the government's commitment to fostering a dynamic and investor-friendly market.

At NEXA, we have extensive experience in the Saudi Arabia real estate market. Our team offers digital marketing services specifically tailored for the real estate sector, from lead generation and content marketing to advanced SEO and market analysis. Contact us today to start your journey with a trusted, results-driven agency.

Frequently asked questions

1. What are the most popular types of real estate investments in Saudi Arabia? 
   Residential properties, including villas and apartments, are popular, along with commercial properties in key cities like Riyadh and Jeddah, and Dubai.
   
   
2. Is it a good time to invest in Saudi Arabia’s real estate market in 2025?
   Yes, with the market showing signs of recovery and strong government support, it’s a promising time for investment, especially in the residential and hospitality sectors.
   
   
3. How does Vision 2030 impact the real estate market? 
   Vision 2030 is driving large-scale developments and increasing foreign investment, boosting both residential and commercial real estate sectors.
   
   
4. What is the outlook for commercial real estate in Saudi Arabia? 
   The commercial sector is gradually recovering, with demand expected to increase as businesses return to office spaces and retail formats evolve.
   
   
5. Are there any legal considerations for foreign investors in Saudi real estate? 
   Recent changes have made it easier for foreign investors to buy property, but it’s advisable to work with a local agency to navigate the regulations.