Real Estate Financing Makes 30% of Saudi Arabia’s Bank Loans

Saudi Arabia's real estate loans have reached a record high of SR883.3 billion (£235.5 billion) by the end of 2024, marking a 15.12 per cent increase compared to the previous year. This surge is attributed to strong demand from both individual and corporate borrowers, according to the data from the Saudi Arabian Monetary Authority (SAMA).

Corporate real estate loans grew by 26.23 per cent, totalling SR202.04 billion, while lending to individuals accounted for most of the loans at SR681.24 billion, an increase of 12.19 per cent. Real estate financing now makes up about 30 per cent of all bank loans in the region, which total SR2.96 trillion.

This growth indicates rising confidence in Saudi Arabia’s property market, with institutional investors driving the development of large-scale commercial centres and residential complexes. Corporate clients increasingly take advantage of favourable financing conditions, especially for mixed-use projects aligned with the country’s Vision 2030 urban development plans.

Large-scale projects such as the Sports Boulevard and King Salman Park are attracting global investment as they move into the development stages. Unlike previous years, when smaller developments were mainly funded by off-plan sales, today’s projects require more sophisticated financing, with a greater reliance on debt.

To support this expanding market, Saudi banks have partnered with the Ministry of Housing to offer streamlined financing solutions, from planning to sales. This collaboration has helped real estate companies to enhance efficiency and provide high-quality developments.