Saudi property market is changing as Riyadh hits $4.7bn, Jeddah stabilizes and Dammam expands
Real estate sales in Riyadh reached SR17.6bn ($4.69bn) in Q3 2025, as the capital prepares to deliver 57,000 new homes in 2026 and 2027, according to new research by Cavendish Maxwell.
Residential transactions in Riyadh reached 13,000 between July and September 2025, up nearly 19 percent quarter-on-quarter.
The city delivered 10,000 new units in the first nine months of the year, with another 6,000 planned during Q4.
Saudi architecture
In Dammam, which made its debut in the latest KSA report by Cavendish Maxwell, real estate sales have reached their highest levels for several years. Transactions reached 3,000 in Q3 2025—up nearly 60 percent year-on-year and 37 percent in Q2—while sales values rose to SR3.2bn ($850m).
Jeddah also recorded a quarterly increase, with transactions up 10 percent to 7,500 and sales values up 9 percent in the quarter to SR8.7bn ($2.31bn).
Despite quarterly gains in all three cities, Riyadh and Jeddah both posted year-on-year declines, driven largely by affordability pressures. Sales fell 44 percent in Riyadh and 19 percent in Jeddah.
Riyadh-based Sean Heckford, Director of Built Asset Consulting at Cavendish Maxwell, said: “Riyadh’s rapid price growth in 2024 has led to significant increases in sales and rental prices, prompting the Government to introduce a five-year rent freeze to address affordability issues.
“In Jeddah, price conditions are stable and affordability pressures have eased slightly. Meanwhile Dammam, where property is affordable, is emerging as the new hot spot for property investment, with year-on-year increases in purchasing activity for both end-users and investors.”
KSA residential market report
Recent research by Cavendish Maxwell also shows:
- Q3 sales prices for apartments and condominiums rose in all three cities, with the largest increase in Riyadh
- Apartment rental prices increased in all three cities, led by Riyadh
- Villa rentals rose in Riyadh and Dammam, but fell slightly in Jeddah
- A total of 22,800 new homes are expected to be delivered across the three cities by the end of 2025.
- Another 105,000 units are planned for 2026 and 2027
- Changes to KSA’s White Land Tax and new foreign ownership rules are expected to accelerate demand
Sales prices: Riyadh leads the gains
The strongest sales price growth was recorded in Riyadh, where average house prices rose to SR6,160 ($1,642) per square meter in Q3, up 7.5 percent year-on-year. Villa prices reached SR5,500 ($1,466) per square meter, a year-on-year increase of 10.1 percent.
In Jeddah, house prices rose 1.6 percent to SR4,360 ($1,162) per square meter, while bathroom prices rose 3.1 percent to SR5,140 ($1,370). In Dammam, house prices increased by 5.8 percent year-on-year and apartment prices increased by 3.2 percent.
Rental rates: capital sees sharp rise
Riyadh recorded the largest increase in rents, with rental houses up 11.8 percent year-on-year and villas up 10.7 percent. Apartment rentals in Jeddah increased by 5.6 percent, while apartment rentals decreased by 2.1 percent. In Dammam, housing rentals increased by 4.8 percent and rental properties increased by 2.2 percent.
Combined, the three cities delivered 13,500 new homes in the first nine months of 2025, with full-year deliveries expected to reach 22,800. By the end of the year, Riyadh will have added 16,000 homes, Jeddah 5,000 and Dammam 1,800.
Looking ahead, Riyadh has 57,000 households between 2026 and 2027, compared to 36,000 in Jeddah and 12,000 in Dammam.
Saudi real estate forecast
New laws and tax changes will change market dynamics from 2026. Foreign ownership legislation, from January 2026, will boost consumer activity, while the newly introduced White Land Tax encourages landowners to sell or develop plots.
Cavendish Maxwell said the five-year rent freeze announced in September would improve affordability in Riyadh but could reduce incentives for landlords to maintain properties or invest in new stock in the short term.
Heckford added: “Saudi Arabia’s Q3 residential market performance reflects a transition phase marked by strong macroeconomic fundamentals and progressive regulatory measures. Despite challenges to affordability in Riyadh, demand remains strong, supported by new laws and tax initiatives.”
“Jeddah shows stability with balanced supply and demand dynamics, and Dammam stands out as a growth center driven by affordability and investor interest. Vision 2030 initiatives and infrastructure investment will be critical to sustaining momentum and opening new investment opportunities across KSA’s major cities.”
