The real estate price index grew by just 1.3% y-o-y in 3Q 2025 — its lowest rate since 1Q 2022, according to data (pdf) from the General Authority for Statistics. The residential sector was behind the cooldown, marking its first decline since early 2024.

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Breaking down the numbers: Residential real estate prices fell 0.9% y-o-y in the third quarter. Land prices slipped 0.9%, and apartment prices fell 1.7%. Villa prices saw a modest increase of 0.2% and floor prices inched up by 0.3%.

Meanwhile, the commercial sector climbed at a slower pace, logging a 6.8% y-o-y increase in 3Q, compared to 11.7% in the previous quarter. Commercial land prices were up 7.2%, building prices rose 3.3%, and showroom prices edged up 1.1%.

Momentum cooled across major regions: Prices in Riyadh finally cooled down, inching up 1% y-o-y, down from 3.6% in the previous quarter. The steepest declines were in Madinah (down 8%), Northern Borders (down 7.7%), and Hail (down 7.3%). Meanwhile, the Eastern Province led the rise in real estate prices with a 6.1% increase, followed by Najran (3.7 %) and Tabuk (3.4%).

Are the reforms starting to take effect? The government has rolled out sweeping reforms to stimulate the real estate market to tackle “unacceptable” real estate prices, the Crown Prince acknowledged in his annual address. This includes a five-year rent freeze, opening property ownership to non-Saudis, permitting foreign investment in Makkah and Madinah real estate firms, and amending the White Land Tax law. The Royal Commission for Riyadh City also lifted temporary suspensions on a total of 114.7 sq km and launched the Tawazoun platform, offering citizens residential plots, capped at SAR 1.5k per sqm.

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