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The residential real estate market in Saudi Arabia is segmented by Type( condominiums,villas and others), key cities and other urban, suburban and rural markets.
The residential market in Saudi Arabia softened in 2018 however, the transaction volumes for real estate have picked up significantly across the key cities of the kingdom in 2019. In line with the Vision 2030, the government aims to double real estate’s contribution to the country’s GDP to 10% by 2020 and is undertaking a couple of measures to achieve this. The government's focus on the real estate sector as part of the diversification process of the economy is anticipated to boost the residential market over the coming years in the country.
Saudi Arabia currently has a population of 32 million which is growing by more than 2% annually. It is dominated by young middle-class Saudis who are first-time homebuyers, as 45% of the country´s population are below 20 years old. The demand from expatriates has further intensified the housing shortage, with about 5.5 million ex-pat workers in the country. With younger Saudi nationals and expatriates displaying a preference for apartments and more affordable properties, the government is taking steps such as incentivizing developers to build affordable housing projects and encouraging banks to introduce more home financing options.
To fulfill its ambition of increasing homeownership by Saudi nationals to 60% by 2020 and 70% by 2030, Saudi Arabia’s housing ministry announced a plan to build approximately 19,500 residential units for its nationals under the ‘Sakani’ housing development program. The Ministry of Housing in partnership with the Real Estate Development Fund (REDF) launched ‘Sakani II’, which aims to deliver 300,000 residential products throughout the Kingdom in 2019. The kingdom has even introduced a rental price index to increase transparency and regulation in the residential real estate sector.
These initiatives are anticipated to increase the homeownership rates in the country which will strengthen the residential real estate market in Saudi Arabia.
This report aims to provide a detailed analysis on the Saudi Arabia residential real estate market. It focuses on the market dynamics, technological trends, insights and government initiatives taken in the residential real estate sector. Also, it analyses the key players present in the market and the competitive landscape in the Saudi Arabia residential real estate market.
|By Key Cities|
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Riyadh and Jeddah which are the two key cities in Saudi Arabia witnessed a rise in housing supply in 2018. As per estimates, in Riyadh, the total housing supply was around 1.29 million units by the end of 2018, up from 1.26 million units at the end of 2017. In Jeddah, the total housing supply stood at 0.817 million units in 2018, which was also an increase from 0.813 million units recorded at the end of 2017.
However, Riyadh’s housing supply is expected to rise by around 30,000 units by 2020 while Jeddah’s housing supply is predicted to increase by around 7,000 units in 2019, and by 16,000 units in 2020. This increase in housing supply is expected to generate demand for new houses in the kingdom.
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Despite the current slowdown in the country's real estate market, the demand for lower and middle-income housing remained strong in Riyadh, Jeddah, and DMA (Dammam Metropolitan Area) in 2019. In Jeddah, the current housing supply is focused mostly on middle-income housing with the majority of the new housing developments happening in the north and the east of Jeddah. Residential developments in Al Khobar are largely taking place in The Al Khamra and Al Aziziyah districts as the central areas have limited availability of residential land following many years of strong development activity.
The number of residential transactions in Riyadh increased by nearly 122% year on year in Q3 2019, and the number of residential transactions in Jeddah also increased by 82% year on year in Q3 2019, indicating a steady recovery in real estate transactions for the fourth consecutive quarter. The number of residential transactions in the DMA(Dammam Metropolitan Area) also increased by 72% year on year in Q3 2019, for the fourth consecutive quarter. The value of residential transactions witnessed a significant increase mainly driven by a surge in transaction volumes as prices remain under pressure. Soft market conditions, efforts to expand the mortgage market, largescale housing schemes, and improving consumer sentiment contributed to this positive momentum in the increase of residential transactions within the country.
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The report covers the major players operating in the Saudi Arabia Residential Real Estate Market. Some of the major players in the market are Jabal Omar Development Company, Al Saeden Holding Company, and Emaar. Mergers and acquisitions (M&A) activity in Saudi Arabia is also expected to increase in the coming years, which is likely to increase real estate development, making more companies enter the market.
1.1 Study Assumptions
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Current Economic Scenario and Consumer Sentiment
4.2 Residential Real Estate Buying Trends - Socioeconomic and Demogpaphic Insights
4.3 Government Initatives, Regulatory Aspects for Residential Real Estate Sector
4.4 Insights on size of real estate lending and loan to value trends
4.5 Insights on interest rate regime for general economy, and real estate lending
4.6 Insights on rental yields in residential real estate segment
4.7 Insights on captial market penetration and REIT presence in residential real estate
4.8 Insights on affordable housing support provided by government and public-private partnerships
4.9 Insights on real estate tech and startups active in real estate segment (broking, social media, facility management, property management)
4.10 Market Dynamics
5. MARKET SEGMENTATION
5.1 BY Type
5.2 By Key Cities
6. COMPETITIVE LANDSCAPE
6.1 Market Concentration
6.2 Company Profiles
6.2.1 Jenan Real Estate Company
6.2.2 Ewaan Co.Ltd
6.2.3 Sedco Development
6.2.4 Jabal Omar
6.2.6 Sedco Development
6.2.7 Abdul Latif Jamal
6.2.9 Al sedan
6.2.10 Dar Al Arkan
6.2.11 Alfirah United Company for Real Estate
6.2.12 AL Nassar
7. FUTURE OF THE MARKET AND ANALYST RECOMMENDATIONS
9. About Us