Saudi Arabia is undergoing a historic change in every aspect of its economy and society. Leading this shift is Vision 2030, the Kingdom’s strategic plan aimed at reducing reliance on the oil industry and building new industries like tourism, construction, entertainment, and hospitality.
Of these sectors, the most important one is real estate, which not only provides a basis for urban development but also boosts the economy and creates numerous job opportunities.
Saudi Arabia, Vision 2030 provides the framework for transforming the kingdom into a thriving, dynamic, innovative, and integrated society with competitive urban cities and a better quality of life. This is only possible through reliable public and private investment in the real estate sector, which aims to advance job opportunities, economic growth, and infrastructural evolution.
As of 2023, the Ministry of Municipal, Rural Affairs and Housing Reports indicates there are more than 400,000 residential units under construction in the Kingdom, with new projects being added every year.
In recent years, Saudi Arabia has begun the construction of some of the largest projects in the history of the world, each aimed at redefining the kingdom’s image and economy.
Saudi Arabia is attempting to create Smart Cities, including the NEOM City of the Future, and is master planning over 30 regions to boost mega real estate projects alongside the entertainment industry.
NEOM will be a gigantic development that will cost half a trillion dollars to build, and the city will be home to nine million people by 2045. The most famous component of this project is known as The Line, which is a 170-kilometre-long city with no cars and no carbon footprint planned to be built from the Red Sea coastline to the middle of the desert.
The NEOM Board claims that the city will add SAR 180 billion ($48 billion) in GDP by 2030 and provide over 380,000 job opportunities.
Located just outside of Riyadh, covering an extensive 334 square kilometres, Qiddiya is projected to attract 17 million visitors per year by 2030. It consists of cultural institutions, housing, motorsport arenas, and themed parks, like Six Flags Qiddiya.
This development will accommodate about 60,000 residents, and its provision will create a total of SAR 17 billion ($4.5 billion) to the GDP.
The Red Sea Project includes over 1,000 residential units, 8,000 hotel rooms, and 50 resorts, all situated within 28,000 square kilometres. By 2030, it is expected to add $5.9 billion to the GDP annually.
By early 2024, the development of over 16 hotel units was underway, and the first phase of construction was nearly complete.
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The population in Saudi Arabia is expected to hit 39 million by 2030. With 2/3 of the population being under 35, there is significant demand for housing in major cities like Jeddah, Riyadh, and Dammam.
Since 2017, government-initiated housing programs like the Sakani Programme have helped over 1.4 million families with financing, subsidies, and land, making it easier for citizens to buy properties.
As a result, property ownership surged to 63.7%, as stated by the housing ministry in 2023, drawing closer to the target set for 2030.
To better appeal to foreign investors, Saudi Arabia has made great changes to its real estate policies. The development of special economic zones (SEZs) in NEOM and King Abdullah Economic City allows for 100% foreign ownership of real estate as well as total foreign investment.
To support the real estate industry, the Public Investment Fund, with an asset value of over $700 billion, has played a crucial role in executing integrated real estate development and there are over twenty REITs on the Tadawul exchange with a fund size of SAR 12 billion ($ 3.2 billion) as of 2024.
Due to these measures, Saudi Arabia is now one of the top countries in the Middle East, offering great opportunities for investment in real estate.
The Kingdom is geo-politically adopting digital adaptations into Real estate such as the blockchain registry system for land, Artificial intelligence-based value estimation of assets, and digital mortgage.
Currently, there are Smart cities under development, such as The Line and King Salman Park, which include the integration of 5G connectivity, green energy systems, and artificial intelligence traffic and waste management systems.
The kingdom secured 17th place in global competitiveness in terms of digital growth in 2023 (IMD World Digital Competitiveness Ranking), which proves the country’s ambitions for a high-tech real estate ecosystem.
Sustainability is no longer a luxury—it’s a necessity. Saudi Arabia is leading the region in adopting green buildings. Saudi Arabia is one of the leaders in the Gulf region in adopting green building standards and environmental construction practices.
The Saudi Green Initiative, introduced in 2021, aims to grow 10 billion trees and targets 50 percent of electricity generation from renewable sources by 2030.
Real estate developers are now required to comply with energy efficiency codes, and flagship projects such as NEOM and the Red Sea Project are set to achieve net-zero carbon emissions.
The real estate sector of Saudi Arabia has the potential to boom to unimaginable heights and is set to experience a period of revolution and innovation in the near future. With Vision 2030 in its sight, mega-projects, and smart sustainable city goals, the Kingdom is aiming to emerge as the leader in smart urban development.
Saudi Arabia is investing in a bold vision that will change how people live, work, and play globally, through the advanced NEOM, Qiddiya, the hub of culture and entertainment, and the Red Sea eco-tourism wonderland.
