Saudi Arabia’s housing market remained hot in the third quarter of 2023 with the total transactions reaching 61,473 worth SR45.9 billion ($12.23 billion), an industry report showed.
The report released by global consultancy firm CBRE showed that the average price for apartments in the Saudi capital rose to SR4,780 per sq. meter, a growth of 16.1 percent compared to a year earlier.
During this period, Alkhobar’s average apartment prices saw an uptick of 2.9 percent to reach SR3,424 per sq. meter, while Dammam’s average apartment prices rose by 2.4 percent to stand at SR2,862 per sq. meter.
The only apartment market to regress in terms of prices was in Jeddah, where average apartment prices fell by 9.5 percent to reach SR3,872, the report showed.
Taimur Khan, head of Middle East Research at CBRE, said: “With the exception of Jeddah, Saudi Arabia’s residential market posted yearly price increases in all tracked cities in Q3 2023 across both the villa and apartment segments.”
He added: “These performances were achieved despite a fall in residential transactions, which stemmed from high-interest rates and as buyers continue to adopt a wait-and-see approach in anticipation of new quality stock which is set to be delivered in the short to medium term.”
In the villa segment of the market, average prices in Riyadh, Dammam, and Alkhobar have shown gains in the 12 months to the third quarter of 2023. In Riyadh, the average price for villas improved by 1.2 percent year on year, reaching SR5,615 per square meter. Dammam and Alkhobar’s average villa prices increased by 1.8 percent and 3.2 percent over the same period in 2022, where average prices registered at SR3,565 and SR3,612 per sq. meter, respectively. Jeddah’s villas segment contracted in the year to the third quarter of 2023 by 3 percent, where average villa prices stood at SR5,411 per sq.meter.
The report, however, showed in comparison to the same period in 2022, the total number of transactions demonstrated a drop of 7 percent, while the total value for residential property transactions in the Kingdom decreased by 11.3 percent.
The total number of mortgage contracts in the year to date to the third quarter of 2023 fell by 37.5 percent. Single-family homes accounted for 69.8 percent of the total value of lending, followed by apartments and land at 24.8 percent and 5.4 percent respectively.
