Official data on Sunday showed that the real estate price index in Saudi Arabia increased by 0.4 percent in the second quarter of 2021 when compared to the same period of the previous year.
According to statistics released by the General Authority for Statistics, residential real estate prices increased by 0.8 percent in the second quarter, while prices for commercial and agriculture properties declined by 0.5 percent and 0.2 percent, respectively.
An increase of 1 percent in residential plot prices increased the prices of residential properties, according to the report.
Meanwhile, the Wafi program, which regulates off-plan property activity in the Kingdom, issued a report highlighting its performance during the first half of the year.
During the first half of 2021, Wafi issued 55 licenses for off-plan sales projects providing 24,328 housing units.
Sales of off-plan properties are growing in Saudi Arabia, but buyers are still cautious about the developer’s abilities to deliver quality housing on time.
According to data from the Wafi program, the sector has steadily increased its share of total residential sales.
As per real estate consultancy Knight Frank, off-plan housing units represent approximately 9 percent of total existing stock, but a massive 60 percent of future supply in Saudi Arabia.
Saudi Arabia’s real estate sector is a powerful economic driver of the country’s gross domestic product (GDP) and has been connected to at least 120 different industries.
This year, mortgage lending in Saudi Arabia increased 27 percent through May, with mortgage rates dropping to between 1 percent to 4.9 percent, compared to 6 percent early last year.
The value of residential real estate financing contracts offered by Saudi banks to individuals reached SR69.5 billion ($18.5 billion) in May, according to data from the Saudi Central Bank (SAMA).
In 2020, SR46.6 billion was lent in 104,000 contracts, representing a 50 percent increase over that period 2020.