Real estate prices in Saudi Arabia returned to rising in the second quarter of this year on an annual basis at 1.3%, the fastest since the second quarter of 2025, after two quarters of declines following government decisions for real estate balance.

The rise in Saudi real estate prices coincided with their rise in Riyadh at the fastest pace since the first quarter of 2025, after two quarters of decline as well, given the capital's significant impact.

According to the Financial Analysis Unit in "Al-Eqtisadiah", the rise in real estate prices comes as the base effect fades, as the second quarter represents the fifth quarterly data after the government decisions on real estate balance in the capital issued at the end of last March.

This means that the two quarters of 2026 and 2025 were affected by the decisions, in addition to the gradual return of demand movement after the initial reaction to the government measures, which may have postponed some decisions until clarity and restructuring of the sector.

Tue, 20 2026

The annual rise in Saudi Arabia came with an increase in residential real estate prices, which have the largest weight in the index (72.2%), by 2.6%, recording the largest rise since the first quarter of 2025, but it comes after three quarters of decline.

The rise in residential real estate was affected by the rise in land prices, given their significant impact that is close to half of the index, recording 6.3%, the highest increase since the first quarter of 2023, which also comes after three quarters of decline. Also, prices of apartments and floors rose, while villa prices recorded the only decline by about 10%, the fastest since data collection began in 2021.

On the other hand, commercial real estate recorded its first annual decline of 3.2%, pressured by land prices, while the rise in agricultural land prices slowed to 11.3%, but it did not affect the index due to its marginal weight of less than 2%.

Al-Jouf tops the rises, and Hail the most decline

Al-Jouf rose the most by 10.4% in the second quarter compared to the same period of 2025, while Hail declined the most by 10.1%, and prices in Riyadh rose by 4.2%, the fastest pace since the first quarter of 2025.

How have real estate prices moved since the balance decisions?

Real estate prices have risen by 1.3% since the issuance of the real estate balance decisions (second quarter of 2026 compared to the first of 2025), coinciding with the stability of residential while commercial and agricultural rose.

The stability of residential real estate prices came with a rise in residential land on one hand, against a decline in the remaining components: villas, apartments, and floors.

Mixed movements in regional real estate since balance decisions

During the last 5 quarters (since the issuance of government decisions), prices fell in 7 of the 13 regions in Saudi Arabia, some with declines of nearly 11%.

By administrative regions, Al-Jouf was the highest riser at 10.4%, followed by the Eastern Province and Makkah. In contrast, Hail was the biggest decliner at 11%, then Al-Baha and Al-Madinah. Prices rose 0.9% in the capital Riyadh.

Mon, 20 2026

Government decisions aim to balance the real estate market

The price declines come after government directives to adjust market balance last March, with a set of measures aimed at addressing high real estate prices in the capital.

Among the measures is lifting the suspension on lands north of Riyadh with a total area exceeding 80 square kilometers, as part of a plan to provide up to 40,000 plots annually to citizens over 5 years, at a price not exceeding 1,500 riyals per square meter, to increase housing supply and reduce price pressures.

The measures also included amending white land fees to reach 10% annually instead of the previous 2.5%, with vacant properties included for the first time, aiming to stimulate supply, encourage development, and reduce investors' retention of unused lands. The fees apply to lands and buildings exceeding 5,000 square meters.

Financial Analysis Unit