Saudi Arabia’s Home Ownership Target on Track
- Business Companies GCC Infrastructure
Global Business Magazine- 5 minutes read
The vision of Saudi Arabia’s Crown Prince and Prime Minister H R H Prince Mohammed bin Salman to ensure world-class housing to Saudi citizens while driving the home ownership rate to 70% by 2030 on track and has already achieved 63.7% by end of 2023.
This is a 16.7 percentage point increase since the National Transformation Plan’s introduction in 2016 and surpassing the government’s 2023 target of 63%, according to Knight Frank MENA’s latest research entitled “The Saudi Report 2025.”
To achieve this, government initiatives to increase housing supply within the low to mid-market segments, as well as programmes such as Wafi and Sakani, have been pivotal in boosting home ownership among Saudi nationals.
Surge in Residential Transactions
During 2024, the total number of real estate transactions across all asset classes in Saudi Arabia surged by 37% to just over 236,690 deals, while the total value of all deals grew by 27% to US71.37 billion.
The Residential transactions, which accounted for 61.5% of all real estate deals by total value, registered a 38% increase in the number of deals to just under 202,661 sales. While the value of residential transactions increased by 35% to $43.92 billion over the same period.
A combination of factors has underpinned the growth in residential real estate transactions in Saudi Arabia over the past few years. In 2023, over 96,000 families benefited from the Kingdom’s Housing Program, which helps to facilitate access to affordable home financing solutions.
During the first half of 2024, an additional 55,000 families benefited from this program, the report explained.
The government has also been actively partnering with private sector developers to expedite the construction of new homes to address a longstanding shortage of affordable but high-quality supply.
For instance, the National Housing Company (NHC) has signed an agreement with China State Construction Engineering Corporation (CSCEC) to build 20,000 housing units in suburbs and communities developed by NHC across various regions of the Kingdom.
Mortgage Activity Increases
The total number of mortgages issued to individuals for home ownership in 2024 increased by 18.9%, compared to a decline of 33.4% in 2023. In parallel, the total value of mortgages issued increased by 17.1% to $24.27 billion.
Initiatives such as the establishment of the Saudi Mortgage Guarantees Services Company, or Dhamanat, which is a government-backed mortgage guarantee service, are in large part driving the surge in home financing levels for citizens.
Rising supply
From a supply perspective, the Ministry of Housing remains committed to expanding affordable housing options to meet rising demand and support the government’s goal of achieving a 70% home ownership rate by 2030.
The Ministry has launched numerous projects across Saudi Arabia in collaboration with private-sector developers. The residential supply across Saudi Arabia’s five major markets totals 3.5 million units.
“Based on our analysis, this figure is projected to reach nearly 3.9 million units by the end of 2028, reflecting the government’s ongoing efforts to enhance housing availability.
Premium Residency Visa boost?
The introduction of regulations allowing foreign investors to own property in Saudi Arabia through new Premium Residency Visa options unveiled in January 2024 has, for the first time, opened the market to international buyers and investors.
Among the new Premium Residency Visa options, one that particularly stands out is the visa linked to owning real estate worth over $1.07 million.
This initiative marks a pivotal shift in the Kingdom’s approach to residency and property ownership by non-Saudis and will have substantial implications for the demand dynamics of the residential market, the report said.
