The Saudi Arabian luxury property market is experiencing a period of unprecedented transformation and growth. Valued at USD 15.1 billion in 2024, the sector is poised to nearly double by 2033, reaching an estimated USD 25.7 billion. This impressive trajectory is fueled by the Kingdom’s Vision 2030 initiative, significant urbanisation, and a focus on attracting international investment. Iconic projects like NEOM, the Red Sea Project, and the Trump Jeddah Tower are redefining the market landscape, while regulatory reforms and infrastructure advancements create a thriving, investor-friendly environment.
Saudi Arabia Property Market Overview
As of 2024, the luxury residential real estate market in Saudi Arabia was valued at approximately USD 15.1 billion. Projections indicate a robust growth trajectory, with expectations to reach USD 25.7 billion by 2033, reflecting a compound annual growth rate (CAGR) of 5.98% from 2025 to 2033.
Key Drivers of Growth
- Vision 2030: Transforming the Kingdom
Saudi Arabia’s Vision 2030 initiative is the cornerstone of its economic transformation. This ambitious plan seeks to diversify the economy by reducing dependence on oil revenues and establishing the Kingdom as a global hub for tourism, commerce, and investment. The real estate sector is central to this strategy, with the government allocating over $1 trillion to infrastructure and residential projects by 2030. This includes luxury developments that cater to high-net-worth individuals (HNWIs) and international investors. Vision 2030 aims to increase Saudi homeownership rates to 70%, a target bolstered by expansive mortgage reforms and public-private partnerships in housing projects. - Government Incentives and Policy Reforms
Recent regulatory changes have made property ownership more accessible and attractive to both domestic and international buyers. The introduction of long-term residency programs like the Premium Residency (Iqama) allows foreign investors to own property and conduct business in Saudi Arabia with fewer restrictions. Additionally, the Saudi Real Estate Refinance Company (SRC) aims to refinance 20% of the residential mortgage market by 2025, ensuring liquidity and stability within the real estate sector. - Rapid Urbanisation and Mega Projects
Urban centers such as Riyadh, Jeddah, and Dammam are undergoing unprecedented growth, with state-of-the-art infrastructure projects reshaping their landscapes. Developments like the Riyadh Metro ($22.5 billion) and King Abdullah Financial District (KAFD) are attracting businesses and expatriates, driving demand for luxury residential spaces. Mega projects like NEOM, the futuristic smart city, and the Red Sea Project, a sprawling luxury tourism destination, are also pivotal in establishing Saudi Arabia as a leader in global luxury real estate. - Expanding Tourism and Hospitality Sector
Saudi Arabia’s focus on tourism as a pillar of its diversification strategy has led to a surge in luxury hospitality projects. The country aims to attract 100 million visitors annually by 2030, supported by initiatives such as the opening of AlUla's historical sites, the development of Soudah Peaks, and the expansion of Jeddah’s waterfront. This influx of tourists and expatriates is creating demand for high-end residential and serviced apartments. - Foreign Direct Investment (FDI)
Saudi Arabia has emerged as an attractive destination for foreign investors due to its stable economy, strategic location, and favourable investment climate. The government’s push to ease restrictions on foreign ownership and streamline business processes is enticing global corporations and individuals to invest in the Kingdom. Real estate is a primary focus, with international developers and institutional investors participating in landmark projects.
Notable Developments
- Trump Jeddah Tower: In partnership with Dar Global, the Trump Organisation announced the development of a luxury residential project in Jeddah, marking its first venture in Saudi Arabia. This project aims to attract international investors and vacationers, enhancing the standards of luxury living in the region.
- Jeddah Tower: Saudi billionaire Prince Alwaleed bin Talal is reviving the Jeddah Tower project, set to be the world's tallest building at over 1,000 meters. The project, which began in 2013 but stalled due to various challenges, has resumed with plans to complete by 2028.
- Mukaab: Construction has commenced in Riyadh on the Mukaab, set to be the world's largest building. The $50 billion structure will stand at 1,300 feet high and 1,200 feet wide, spacious enough to encompass 20 Empire State Buildings. The project is part of Crown Prince Mohammad bin Salman's Saudi Vision 2030, aiming to modernise and diversify the economy.
Luxury Property Market
The luxury property market in Saudi Arabia is characterised by rapid growth, high-profile developments, and increasing international interest. As of 2024, the market was valued at approximately USD 15.1 billion, with projections to reach USD 25.7 billion by 2033, representing a compound annual growth rate (CAGR) of 5.98%.
- Rising Demand in Major Cities
Riyadh, Jeddah, and Dammam are the focal points of Saudi Arabia’s luxury property market. In 2024, transaction volumes in Riyadh surged by 51.6% year-over-year, driven by the city's evolving status as a global financial hub. Developments like the King Abdullah Financial District (KAFD) and Diriyah Gate, a heritage and luxury lifestyle destination, are transforming these urban centers into prime locations for high-end real estate. - Mega Projects Shaping the Market
High-profile projects such as NEOM, the world’s most ambitious smart city, and the Red Sea Project, which aims to create a new benchmark for sustainable luxury tourism, are drawing significant attention from investors. These projects are designed to meet the needs of an affluent clientele, offering bespoke villas, branded residences, and ultra-luxurious amenities. - Impact of Global Events
Hosting international events like the 2027 AFC Asian Cup and the 2034 FIFA World Cup has bolstered Saudi Arabia's global profile. These events not only drive tourism but also elevate demand for premium accommodation and long-term residency options. - Investment-Friendly Policies
Saudi Arabia’s real estate sector benefits from policies that encourage investment, such as reduced down payment requirements (from 30% to 5% for first-time buyers) and tax incentives for property developers. These measures, coupled with the government’s extensive funding of infrastructure projects, ensure a thriving and investor-friendly environment. - Growth in Branded Residences
The rise of branded residences, such as the Trump Jeddah Tower and Neptune Interiors by Mouawad, underscores the growing sophistication of the luxury property market. These developments combine iconic architecture with exclusive lifestyle offerings, appealing to HNWIs and international buyers.
Trump Tower Jeddah
Future Outlook
Saudi Arabia's luxury residential real estate sector is poised for substantial growth, driven by strategic initiatives, economic diversification, and significant investments in infrastructure. The market, valued at USD 15.1 billion in 4Q 2024, is projected to reach USD 25.7 billion by 2033, exhibiting a compound annual growth rate (CAGR) of 5.98% during the forecast period.
Expansion of Branded Residences
The Kingdom is experiencing a notable increase in branded residential developments. The Middle East accounts for 12% of the global supply of branded residences, with a projected growth of 120% by 2030—the strongest for any global region.
Notable projects include the Ritz-Carlton Residences in Diriyah, marking the brand's first luxury villa community in Saudi Arabia.
Additionally, Dar Al Arkan has partnered with renowned fashion designer Elie Saab to launch Etoile, the designer’s first branded residence in the Kingdom, located within the Sedra community in Riyadh.
Digital Transformation in Real Estate
The adoption of digital technologies is transforming Saudi Arabia's real estate sector. Developers are increasingly utilizing virtual property tours, artificial intelligence-driven investment analysis, and blockchain for transparent transactions. These advancements enhance investor confidence and streamline property acquisition processes, particularly for foreign buyers.
Sustainability and Eco-Friendly Developments
There is a growing emphasis on sustainability within the luxury property market. Developers are incorporating eco-friendly features and green technologies into new projects to meet the increasing demand for sustainable living options.
Cultural and Lifestyle Initiatives
Saudi Arabia's efforts to position itself as a cultural and lifestyle destination are fuelling demand for high-end properties. The development of cultural landmarks and entertainment hubs enhances the appeal of nearby luxury residences, attracting both domestic and international buyers.
Emerging Affluent Demographics
The expansion of Saudi Arabia’s middle-income class is creating a new segment of affluent buyers seeking premium properties. This demographic shift supports the broader growth of the luxury sector, as more individuals aspire to upscale living standards.
Investment in Secondary Cities
While Riyadh and Jeddah remain primary markets, secondary cities like Al Khobar are attracting investment in luxury developments. For instance, the Heart of Khobar project, a SAR 6 billion venture, is set to enhance the city's real estate landscape.
Global Sporting Events
Hosting international events, such as the 2027 AFC Asian Cup and the 2034 FIFA World Cup, is expected to boost demand for premium accommodations, further stimulating the luxury property market.
Empowerment of Female Investors
The lifting of restrictions on women has empowered a new demographic of investors. With greater economic independence, women are emerging as significant players in the luxury property market, contributing to its diversification and growth.
Infrastructure Enhancements
Ongoing infrastructure projects, including transportation and urban development, are opening new areas for luxury real estate development, making previously underdeveloped regions more accessible and attractive to investors.
Conclusion
Saudi Arabia's luxury property market is on a trajectory of significant growth, supported by diversification efforts, technological advancements, and socio-economic reforms. As the Kingdom continues to implement transformative projects and policies, the luxury real estate sector offers promising opportunities for investors seeking to capitalise on a dynamic and evolving market.
*This report is intended to provide a comprehensive overview of the luxury property market in Saudi Arabia as of January 2025.
Saudi Arabia Residential Real Estate Outlook 2025
A comprehensive analysis of investment opportunities, market trends, and strategic insights for global investors in Saudi Arabia's dynamic residential property market.
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