Riyadh residential sales hit SAR17.6bn as 57,000 new homes line up for delivery – report

Residential property sales in Riyadh reached SAR17.6 billion ($4.69 billion) in the third quarter of 2025, as the Saudi capital prepares for the delivery of 57,000 new housing units over the next two years.

According to data from real estate advisory Cavendish Maxwell, around 13,000 residential transactions were recorded in Riyadh between July and September, up nearly 19 per cent from the previous quarter.

The city delivered about 10,000 new homes in the first nine months of the year, with a further 6,000 units expected to be completed in the final quarter of 2025.

Despite the quarterly increase, annual sales activity in Riyadh declined 44 per cent year-on-year, reflecting affordability pressures following rapid price growth last year.

Dammam outperforms, Jeddah shows stability

Dammam emerged as one of the strongest-performing residential markets in the Kingdom, recording its highest transaction volumes in several years. The Eastern Province city saw around 3,000 sales in the third quarter, up nearly 60 per cent from a year earlier and 37 per cent from the previous quarter. Transaction values totalled SAR3.2 billion.

Jeddah also recorded higher quarterly activity, with transactions rising 10 per cent to 7,500 and sales values increasing 9 per cent to SAR8.7 billion. On an annual basis, however, sales volumes in Jeddah fell 19 per cent.

Sean Heckford, director of built asset consulting at Cavendish Maxwell, said: “Riyadh’s rapid price appreciation in 2024 drove sharp increases in both sales and rental values, leading to affordability pressures and the introduction of a five-year rent freeze.”

Heckford said. “Jeddah has seen price stabilisation and some easing in affordability constraints, while Dammam is benefiting from relatively lower entry prices, attracting both end-users and investors.”

Residential prices increased across all three cities during the quarter with Riyadh recording the strongest gains.

Average apartment prices in the capital rose 7.5 per cent year-on-year to SAR6,160 per square metre, while villa prices climbed 10.1 per cent to SAR5,500 per square metre. In Jeddah, apartment prices increased 1.6 per cent to SAR4,360 per square metre and villas rose 3.1 per cent to SAR5,140. Dammam recorded annual price increases of 5.8 per cent for apartments and 3.2 per cent for villas.

Riyadh sees strongest rent growth

Rental growth remained strongest in Riyadh, where apartment rents rose 11.8 per cent year-on-year and villas increased 10.7 per cent. Apartment rents in Jeddah rose 5.6 per cent, while villa rents declined slightly. In Dammam, apartment rents increased 4.8 per cent and villa rents rose 2.2 per cent.

Across Riyadh, Jeddah and Dammam, around 13,500 new homes were delivered in the first nine months of 2025. Total completions for the year are expected to reach 22,800 units, with a further 105,000 homes scheduled for delivery in 2026 and 2027.

By the end of this year, Riyadh will have added around 16,000 new units, compared with 5,000 in Jeddah and 1,800 in Dammam. Over the next two years, Riyadh accounts for the largest share of future supply, with 57,000 units in the pipeline, followed by 36,000 in Jeddah and 12,000 in Dammam.

The report said regulatory changes are likely to influence market dynamics in 2026 and beyond. A new foreign ownership law, due to take effect in January, is expected to support demand from international buyers, while reforms to the White Land Tax are designed to encourage landowners to develop or sell undeveloped plots.

The consultancy said Riyadh’s five-year rent freeze, announced in September, is likely to improve affordability in the near term but could reduce incentives for landlords to maintain existing properties or invest in new housing supply, potentially placing pressure on future development activity.

“Demand remains resilient despite affordability challenges, supported by regulatory reform and broader economic fundamentals,” Heckford said.

“Jeddah is showing stability, while Dammam stands out as a growth market. Vision 2030 initiatives and infrastructure investment will be key to sustaining momentum across Saudi Arabia’s major cities.”