The Kingdom’s real estate price index rose 2.3% y-o-y in 2024, driven by increases in costs of residential, commercial and agricultural real estate, according to the latest General Authority for Statistics (Gastat) real estate index (pdf).

The breakdown: The rise was primarily driven by a 6.1% y-o-y increase in the commercial sector, due to the increase in the prices of commercial lands by 6.2% and buildings by 6.0%. Agricultural real estate prices rose 1.4% y-o-y, while residential real estate increased 1%

In 4Q 2024, the index rose 3.6% y-o-y, on the back of a 5.0% increase in commercial real estate prices, as land prices saw a 5.2% y-o-y increase, while buildings recorded a 5.1% increase. Meanwhile, residential prices grew 3.1%, and agricultural real estate prices rose 2.8%.

Riyadh takes the crown: The capital’s real estate prices grew 10.2% y-o-y in 4Q 2024, followed by Najran (4.6%), and Tabuk (+1.1%).

REMEMBER- Housing costs, particularly rents, were the primary driver of Saudi’s annual inflation rate throughout 2024, which reached its peak in November at 2.0%.

Quarterly highlights: The index logged a 1.6% increase in 4Q 2024 compared to 3Q. The residential sector inched up 1.0% q-o-q, on the back of a 0.9% increase in land prices, a 0.5% increase in apartments, and a 2.4% increase in villa prices. Commercial real estate prices were also up 2.7% q-o-q on the back of a 3.2% y-o-y rise in land prices, softened by a 2.3% decline in buildings prices. Meanwhile, agricultural real estate prices decreased by 9.8% in 4Q.

IN OTHER REAL ESTATE NEWS-

Our real estate sector is projected to see a strong demand in the office market in 2025 amid increased leasing activity and high rental growth expectations, according to Savills Real Estate forecasts.

Key contributors include: High-end residential developments in Riyadh, Grade-A office spaces in Jeddah, retail spaces in Dammam, mid-tier residential units in emerging Riyadh districts, hospitality projects in Makkah and Medina, and industrial projects in Dammam Industrial City. In addition, mixed-use projects in Neom, luxury hospitality projects on the Red Sea Coast, and tech-focused commercial real estate in Riyadh are expected to contribute to the trend.

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