Saudi Arabia’s economy is undergoing a major transformation, moving beyond its traditional reliance on oil and into diversified sectors such as tourism, logistics, finance, and real estate. As part of Vision 2030, the government has set ambitious targets for urban development, housing, and infrastructure, making property one of the fastest-growing areas of the Kingdom’s economy.
Opportunities in real estate in Saudi Arabia now span across residential, commercial, hospitality, and logistics assets, positioning the Kingdom as a regional hub for property investment. Large-scale government initiatives, giga-projects, and rising domestic demand are fueling consistent growth, making the sector attractive to investors seeking entry into the Gulf market.
Market Growth Drivers
Urban expansion: Riyadh is undergoing rapid development, with projects such as King Salman Park, Diriyah Gate, and Qiddiya reshaping the city. Jeddah is focusing on its waterfront and Corniche redevelopment, while Dammam and the Eastern Province are benefiting from industrial growth.
Government initiatives: The Sakani housing program aims to provide affordable homes for citizens, while mortgage market reforms are making ownership easier for middle-class families.
Tourism and hospitality: The Red Sea Project, AlUla heritage site, and new resorts along the western coast are creating strong demand for hotels, serviced apartments, and residential units near tourist hubs.
Infrastructure investments: Expansion of Riyadh’s King Khalid International Airport and the upcoming Jeddah Airport terminal underline long-term growth in commercial and residential demand.
Investment Opportunities
Residential
Affordable housing: Driven by the government’s Sakani program, which delivered over 1.2 million housing products by 2023, the sector continues to benefit from subsidies, low-interest mortgages, and incentives for first-time buyers. Developers partnering with the Ministry of Housing are well-positioned for steady sales.
Luxury segment: Demand for high-end apartments and villas is strongest in Riyadh and Jeddah, where population growth and expatriate professionals are fueling purchases. Projects tied to Diriyah Gate and Jeddah Central are examples of where investors can target long-term appreciation.
Commercial
Riyadh office market: With more than 80 global companies moving their regional headquarters to Riyadh under the government’s HQ program, demand for Grade A office space in the King Abdullah Financial District and new business parks is climbing. Investors can explore REITs or commercial leasing ventures in this segment.
Retail developments: Jeddah and Dammam are seeing increased mall and mixed-use retail projects, driven by rising disposable incomes and tourism inflows, offering consistent rental opportunities.
Hospitality
Religious tourism: Makkah and Madinah hosted over 13 million international pilgrims in 2023, with targets to reach 30 million by 2030. Hotels, serviced apartments, and mixed-use hospitality projects remain undersupplied during peak seasons, making this an attractive short-term rental and hospitality investment play.
Leisure tourism: Along the Red Sea coast, the first phase of the Red Sea Project has already opened resorts in 2023. Additional phases will bring thousands of rooms and residential units, creating early-stage entry points for investors.
Logistics and Industrial
Ports and trade hubs: The expansion of Jeddah Islamic Port and the development of King Salman International Airport in Riyadh are increasing demand for warehouses, cold storage, and distribution centers. Private investors and logistics REITs are actively targeting this segment.
NEOM’s Oxagon: Marketed as the world’s largest floating industrial complex, Oxagon is attracting manufacturing, supply chain, and green energy industries. Real estate linked to logistics and worker housing here represents a long-term play.
Regional Hotspots
Riyadh
Riyadh is the Kingdom’s largest and fastest-growing city, home to over 7.5 million people. The government aims to nearly double its population by 2030, supported by Vision 2030 projects such as King Salman Park, one of the world’s largest urban parks, and Diriyah Gate, a USD 63 billion cultural and residential development. The King Abdullah Financial District (KAFD) is attracting multinational companies, creating strong demand for both Grade A office space and high-end housing.
Jeddah
As Saudi Arabia’s main Red Sea port and gateway for religious tourism, Jeddah plays a dual role in logistics and hospitality. The Jeddah Central Project, valued at USD 20 billion, is transforming 5.7 million square meters of waterfront into residential, commercial, and tourism zones, including a marina and opera house. The expansion of King Abdulaziz International Airport is also boosting visitor capacity, increasing the need for hotels and serviced apartments while creating sustained residential demand.
NEOM and the Red Sea Coast
NEOM, a USD 500 billion mega-city under construction in the northwest, is being developed in stages, including The Line, a linear smart city stretching 170 km, and Oxagon, an industrial and logistics hub. These projects are designed to accommodate millions of future residents and businesses, with housing, commercial, and industrial real estate built into every phase. Along the coast, the Red Sea Project is delivering 50 resorts and 8,000 hotel rooms by 2030, with the first hotels already operational in 2023, directly fueling demand for hospitality and residential property.
Eastern Province
Cities such as Dammam and Dhahran form the heart of Saudi Arabia’s energy industry and house the headquarters of Saudi Aramco, the world’s largest oil company. The region is experiencing population growth from professionals employed in oil, gas, and related industries, increasing demand for both residential housing and commercial office space. Infrastructure upgrades, including the King Fahd Causeway expansion linking Saudi Arabia to Bahrain, further enhance the appeal of real estate in this region for both business and cross-border commuters.
Market Outlook & Growth Potential
Saudi Arabia’s real estate sector has established itself as a critical driver of the non-oil economy. The population, projected to exceed 40 million by 2030, is already fueling housing demand. At the same time, institutional players such as sovereign wealth funds and REITs are investing heavily, adding liquidity and maturity to the market.
Rental yields in Saudi Arabia range from 5% to 7% in key urban centers, making the sector competitive with other Gulf markets. The combination of long-term infrastructure projects, legal reforms enabling foreign ownership in certain areas, and rising domestic demand points to a sustainable growth trajectory.
Investor Takeaways
Diverse entry points: From affordable housing backed by government initiatives to luxury beachfront and branded residences.
Long-term growth: Giga-projects like NEOM, Red Sea, and Diriyah Gate will take years to complete, offering investors opportunities aligned with phased growth and appreciation.
Strong fundamentals: A growing middle class, favorable mortgage policies, and large-scale infrastructure investments ensure steady demand.
Regional positioning: As part of the wider GCC, Saudi Arabia’s market complements opportunities in Dubai and Abu Dhabi, offering investors a diversified Gulf portfolio.
