Saudi Arabia’s Home Sales Boom Ahead of Landmark 2026 Foreign Ownership Law
Saudi Arabia’s property market is riding a strong wave of momentum, with residential sales surging across the Kingdom in the first half of 2025—well before a new law allowing foreign ownership takes effect in January 2026.
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Madinah Leads the Surge
The standout performer has been the Holy City of Madinah, where residential deals jumped 49% year-on-year to reach SR3.4 billion in H1-2025.
Across the Kingdom, demand for homes remained the main driver of real estate activity, accounting for 63% of total transactions. Residential sales climbed 7% compared to last year, with nearly 93,700 deals worth SR77.5 billion recorded out of the total SR123.8 billion market value.
“This sustained momentum is underpinned by increased mortgage activity, government support schemes and the delivery of new housing stock in key urban locations,” noted a report from Knight Frank.
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The Anticipation of 2026
The introduction of the Law of Real Estate Ownership by non-Saudis is being described as a “gamechanger” for the Saudi market.
“While it’s still too early to assess any impact on the residential market, we are aware of international demand—particularly from Muslim high-net-worth individuals, 84% of whom are keen to invest in the Kingdom,” said Faisal Durrani, Partner – Head of Research, MENA at Knight Frank.
The legislation will open Saudi Arabia to foreign investors, bringing it in line with some of its GCC peers. Market watchers believe there is already pent-up demand from global investors, which could materialize in the form of direct purchases or joint ventures in 2026.
Projects like Dar Global’s Trump Tower in Jeddah—with more branded developments expected in Riyadh—are already stoking international interest.
Riyadh Market Snapshot
In Riyadh, affordability concerns have cooled transaction volumes, especially among younger Saudis. Yet, prices remain resilient.
- Average apartment prices in the capital rose 10.6% in Q2-2025 to SR6,175 per square metre.
- Well-connected neighborhoods like Olaya, Al Yasmin, and Hittin saw strong price growth.
- Al Taawun recorded a staggering 32% increase, reaching SR9,470 psm, while King Abdullah District rose 17% to SR7,656 psm.
- Even budget-conscious southern Riyadh saw prices edge up to SR3,000 psm, showing sustained demand from first-time buyers.
The launch of the Riyadh Metro in late 2024 has further boosted demand, particularly in districts with enhanced transit access.
What’s Next for the Market?
According to Harmen De Jong, Knight Frank’s Regional Partner – Head of Consulting, MENA, the new foreign ownership law will “energize the market by boosting liquidity and enhancing the quality of developments.”
“Riyadh’s current market adjustment is part of a broader and healthier evolution, positioning the city for more diversified and sustainable long-term growth,” he added.
With rising demand, bold new projects, and foreign investors preparing to enter in 2026, Saudi Arabia’s real estate sector is gearing up for a transformative decade under Vision 2030.
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