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1. Housing Economics
in Saudi Arabia
Explore the dynamics shaping the Saudi Arabian housing market, from demographic
trends to government initiatives and real estate development.
supervisor :DR. AYA AL-BADAWI
Student name : Alaa Alotaibi

2. Overview of the Saudi Housing Market
Diverse Residential
Landscape
The Saudi housing market
encompasses a wide range of
residential options, from high-
rise apartments in urban
centers to spacious villas in
planned communities.
Active Development
Rapid urbanization and
population growth have fueled
extensive real estate
development, with new projects
constantly underway across the
Kingdom.
Expanding
Consumer Base
Saudi Arabia's young, affluent
population is driving increased
demand for modern, high-
quality housing options that
cater to their evolving
preferences.

3. Demographic Trends and Housing
Demand
Saudi Arabia's rapidly growing population, marked by a median age under 30, is fueling robust demand for housing across
the Kingdom. As the population becomes more urban and affluent, preferences are shifting towards modern, high-quality
residences in planned communities and city centers.
These demographic shifts, combined with rising incomes and changing lifestyle preferences, are driving
strong demand for a diverse range of housing options to meet the evolving needs of the Saudi
population.
$2.40
$1.20
$3.60
$0.00
Popula tion Urbaniza tion Household Formation

4. Government Initiatives and Policies
Public-Private
Partnerships
The government is partnering
with private developers to spur
real estate investment and
accelerate housing construction
across the Kingdom.
Regulatory Reforms
Reforms to land use laws,
construction permits, and
mortgage regulations aim to
streamline the housing
development process and make
it more efficient.
Affordable Housing
The Saudi government has
launched several programs to
increase access to affordable
housing, including subsidies and
financing options for middle-
income families.

5. Developmental Housing Goals
2.3M
Homes
The Saudi government aims to
deliver 2.3 million new homes
by 2030 to address the growing
housing demand.
$20B
Investment
Over $20 billion in government
funding has been allocated to
support housing development
and affordability initiatives.
15%
Homeownership
The target homeownership rate
is set at 15% by 2030, up from
the current 47% rate.
The Saudi government has set ambitious developmental housing goals to transform the country's real
estate landscape. Key targets include constructing 2.3 million new homes, mobilizing $20 billion in
funding, and increasing the homeownership rate from 47% to 15% by 2030.

6. Real Estate Development and Investment
The Saudi real estate market has seen significant growth in
recent years, driven by government initiatives, private
investment, and rising consumer demand. Developers are
constructing high-quality residential communities, integrated
mixed-use projects, and sustainable neighborhoods to cater
to the evolving housing preferences of the Saudi population.
Global and regional real estate firms have increasingly invested in the Saudi
market, attracted by the country's strong economic
performance, favorable demographics, and supportive government policies.
This influx of capital has fueled new real estate development
and expansion across the Kingdom.

7. Examples
The Saudi housing market features a range of
innovative real estate developments, from sleek, high-
rise apartment buildings in urban centers to sprawling,
master-planned communities on the outskirts of major
cities. These projects showcase the country's
commitment to meeting evolving housing demands and
delivering world-class living experiences.

8. The Housing Program
Delivery Plan (2021-2025)

9. 4
Figure 3: The Program’s 2030 Roadmap
Housing Program is looking forward executing a 3rd phase afterwards between 2026 and 2030
where it is expected that the program and the whole ecosystem would have reached the
required level of maturity. Accordingly, we will be able to launch new initiatives for enhancing
policies making and applying the right legislations and regulations to direct the housing market
to reach the 70% ownership rate by 2030 as well as realizing the financial sustainability.

10. Housing program's mission for 2025 strategy

“Our mission is to mature the policies, regulations and institutions the housing market
requires to meet the demands of the Kingdom's inhabitants as the economy and society
realize the ambitions of the Vision 2030”
In Phase I, The Program developed a strategy designed to support Level 3 objectives and,
specifically, transform the state of home ownership in the Kingdom. The rapid acceleration in
ownership achieved by the Program combined with shifts in the global-macro environment, fiscal
realities in the Kingdom and guidance received by SMC, amongst other trends, warrant a
reconsideration of how The Program delivers its Vision 2030 mandate. The 2025 Strategy,
therefore, reconsiders the strategic direction of The Program. Informing the direction setting are
multi-dimensional inputs as following:
• Expressed preferences of potential Saudi home buyers
• Global trends and best practices in the housing market
• The current state of the Kingdom’s housing market
• 70% of Targeted ownership rate for Saudi families by 2030
• Insights gleaned from interviews with the developer and contractor industry
• Delivery performance of the Phase 1 Strategy
• Interviews with senior leaders inside the Housing Ecosystem
Detailed analyses of these inputs were conducted and result in a set of synthesized
implications for the direction of the 2025 Strategy. The five implications identified through the
analyses represent paradigm shifts for The Program:
• Strategic Objectives – Housing affordability is the core issue to tackle: While strategically
focusing on ownership was a key success factor for Phase I, Phase II requires a pivot towards
tackling the underlying unaffordability of the housing market across the country. This is the
critical residual challenge in the market limiting Saudi families’ opportunities for adequate
housing (the Level 3 direct objective). The Program, however, must continue to also focus on
providing access to housing for vulnerable groups and maturing the residential housing sector
and increase the ownership rate.
Program Objectives and Strategic Pillars
Strategic Direction Setting

11. Initiatives Portfolio
Figure 2: Initiatives included in the housing program strategy
Before detailing the initiatives, it is necessary to clarify the interdependencies and correlation
among the initiatives. The following subsections address the relations for each of the three
main strategic pillars in 2025 delivery plan: (1) The beneficiary’s ability to afford costs,
Beneficiary affordability pillar (2) Financial solutions and (3) Supply matters Maturity.
(I) The Pillar of supporting beneficiaries’ ability to afford the costs: Beneficiary Affordability
Pillar: pillar includes 6 initiatives, from which five are owned by MOMRAH and one initiative,
enhance social responsibility among corporate in the housing sector, is owned by the Ministry
of Human Resources and Social Development.
MOMRAH’s initiatives: The Ministry is the main owner of the demand aide in the housing
market via Sakani Platform. This initiative will be the connection point between houses buyers
and the available housing products and real estate finance. In addition, the Ministry is
responsible for delivering the units to the most vulnerable groups in society via development
housing. The Ministry will be able to identify the demand and coordinate between pillar
initiatives by managing the comprehensive process to identify the potential housing

12. For the Eastern region and Riyadh, the rise in the share of
expenditure from 2007 to 2013 was noteworthy. The growth
in spending on housing, water and domestic energy
surpassed the growth in total household expenditure. In the
Eastern region, average monthly household expenditure in
the studied category surged from SAR 2,213 to SAR 3,009,
while in Riyadh, spending rose less markedly, from SAR
2,211 to SAR 2,457 over the same period. The change in the
Eastern region was likely a consequence of a tightening
housing market and an increase in housing rents. The
partial deregulation of electricity prices that occurred in
January 2018 was also a contributing factor.
Similar to the situation in 2013, it appears that household
incomes were not reported as part of the 2007
survey results.

13. 1.
2.
3.
4.
5.
These have all been met. The supply of housing in
KSA has significantly increased and many Saudi
families have achieved their ambition of home
ownership. In 2020, the rate of home ownership in
KSA reached 62% and will meet the target of 70%
by 2030. The Sakani programme has helped more
than 210,000 Saudi families in 2021, bringing the
total number of families benefiting from the
programme to 1.2 million. The mortgage market in
KSA has also grown significantly. In 2020, 295,590
contracts worth a total of SAR 140.7 billion were
offered to Saudi families.
Under the leadership of the Minister of Municipal and
Rural Affairs and Housing (MoMRA), His Excellency
Majed bin Abdullah Al-Hogail, the housing sector has
been radically transformed. The key aim of Vision
2030 – to increase the rate of home ownership to
70% - will be achieved by 2030.
Real estate is a vital element of the KSA economy,
contributing around 7% of GDP, supporting numerous
other sectors, and generating 40,000 job
opportunities in 2021. As the KSA economy continues
to diversify, the sector will become more influential -
the goal is to increase the sector’s contribution to
GDP to 10% by 2030.
Improve access to finance
Introduce new and affordable housing products to the market
Introduce efficiencies into the housing sector’s operations
Strengthen the sector’s foundations, and
Improve the governance of the housing program.
The first phase of
the Housing
Programme had
five main
objectives:
Key results achieved
to date

14. Future Outlook and Opportunities
2
1
Innovative Financing
New mortgage products and government
incentives
Smart Technology
Integration of IoT and energy-efficient
solutions
3
The Saudi housing market is poised for continued growth, with a focus on delivering a diversified array
of modern, sustainable homes to cater to the evolving preferences of Saudi citizens. Innovative
financing options and government support will help improve affordability, while the incorporation of
smart home technologies will enhance energy efficiency and livability across new residential
developments.
As the Kingdom progresses towards its ambitious 2030 goals, the housing sector will play a vital role in
shaping the country's urban landscape and quality of life. With a blend of government initiatives,
private investment, and technological advancements, the future outlook for housing in Saudi Arabia is
one of tremendous potential and opportunity.
Diversified Housing
Expanding range of modern, sustainable
homes

15. THANK YOU