Residential Real Estate Market Set for Significant Surge in Saudi Arabia
The residential real estate market in Saudi Arabia is poised to experience a significant surge, driven by private buyers who are expected to invest SR4.58 billion ($1.22 billion) this year, according to an analysis conducted by global property consultancy firm Knight Frank in collaboration with YouGov.
Investors Seek Premium Residential Offerings in Mega-Development Projects
The Saudi Report 2025 highlights that investors are willing to pay substantial premiums for homes within the Kingdom’s mega-development projects. The study surveyed 1,037 households, including 100 expatriates based in Saudi Arabia, and found that SR2.75 billion of potential private capital is ready to be deployed into these transformative projects.
NEOM Remains the Most Sought-After Destination
NEOM has emerged as the most sought-after destination among respondents, with 41 percent of those earning over SR80,000 per month expressing an intent to spend more than SR20 million on homes in such large-scale developments. The findings underscore the growing demand for premium residential offerings in these projects, which align with the Kingdom’s Vision 2030 economic diversification agenda.
Decrease in Popularity of NEOM Among Saudi Nationals
Faisal Durrani, partner and head of research for MENA at Knight Frank, noted that while NEOM continues to be a popular choice among Saudi nationals, its popularity has decreased from 84 percent in 2023 to 17 percent this year. There are likely to be several reasons for this decrease, including the emergence of other giga-projects over the last two years, perceptions around households’ ability to afford owning a home in NEOM’s subprojects, and a lack of ready-to-move-into homes.
NEOM Still Favored by Expatriates
Despite the decrease in popularity among Saudi nationals, NEOM remains favored by expatriates with monthly incomes over SR30,000. However, 20 percent of all expats surveyed have no desire to purchase residential real estate in any of the giga-projects, likely due to a lack of understanding of what will eventually be available and difficulty in navigating expat ownership rules.
Shift in Preferences Among Higher-Income Groups
Durrani noted that higher-income groups are shifting their preferences towards more exclusive developments. For instance, those on monthly incomes between SR70,000 and 80,000 prefer to own a home at the Red Sea Project and King Salman Park over NEOM.
ROSHN Emerges as Key Player in Giga-Projects
Saudi Arabia’s leading residential developer, ROSHN, has emerged as a key player in the Kingdom’s giga-projects. According to Knight Frank, ROSHN’s SEDRA development in Riyadh is the most sought-after project among respondents, with 39 percent selecting it as their top choice.
ROSHN’s Affordable Homes and Integrated Community Settings
ROSHN’s focus on affordable homes in integrated community settings has played a pivotal role in its widespread appeal. Other highly sought-after ROSHN developments include Warefa in Riyadh and Marafy in Jeddah.
Tariq de Jong on ROSHN’s Rising Prominence
Tariq de Jong, regional head of residential research at Knight Frank, emphasized ROSHN’s rising prominence among Saudi homebuyers. "Away from NEOM, Saudi nationals and Saudi-based expats are actively targeting projects by ROSHN," he said.
Conclusion
The residential real estate market in Saudi Arabia is poised for a significant surge, driven by private buyers investing SR4.58 billion ($1.22 billion) this year. The findings of the Saudi Report 2025 highlight the growing demand for premium residential offerings in mega-development projects and the importance of understanding the preferences of higher-income groups.