Introduction
Saudi Arabia’s real estate market is expected to experience major growth in 2025. Backed by Vision 2030 and a strategic push to diversify the economy, the Kingdom is becoming one of the most attractive real estate destinations in the region.
What’s Driving the Growth
The non-oil sector is forecasted to grow by 5.8% in 2025, compared to 4.5% in 2024. This boost is fueled by massive infrastructure investments and increasing private sector participation. Several sectors within real estate, such as residential, commercial, hospitality, and logistics, are seeing strong demand.
Residential and Office Markets on the Rise
Riyadh’s office market is a prime example of this upward trend. Grade A office buildings had just 0.2% vacancy in late 2024, with rents reaching $609 per square meter. More than 888,000 square meters of new office space is expected to enter the market in 2025.
On the residential side, villas made up over half of all transactions in Riyadh, while in Jeddah, apartments are leading the way. This indicates strong and steady demand across various property types.
Hospitality and Retail Transformation
The hospitality sector is booming, especially in Riyadh and Jeddah, thanks to corporate tourism, global events, and religious travel. Riyadh saw a 13.3% rise in average daily hotel rates, hitting $239. Over 2,300 new hotel rooms are expected to be added in 2025.
Retail is also evolving. The trend is shifting toward open-air and community-driven shopping spaces. While community malls grew by 5.5%, large regional malls saw a 9.3% drop, signaling changing consumer preferences.
Industrial and Logistics Growth
The logistics and warehousing sector is expanding quickly, supported by increased e-commerce activity and economic diversification. Both Riyadh and Jeddah reported rising rental rates, showing strong investor and tenant interest.
A Strategic Future
Saudi Arabia’s Vision 2030 continues to attract foreign and local investment. The country is preparing to host mega-events like Expo 2030 and the FIFA World Cup 2030, which are expected to further accelerate infrastructure development and boost demand across real estate sectors.
The data center industry is also gaining traction. By the end of 2024, Saudi Arabia ranked third in live colocation facilities and accounted for 12.6% of the region’s operational IT load capacity.
For Investors
The outlook for Saudi Arabia’s real estate sector in 2025 is very promising. Whether you’re looking to buy real estate in Saudi Arabia or invest in high-demand areas like Riyadh or Jeddah, the market is full of opportunities. From residential to hospitality and logistics, every segment is showing healthy growth. With Vision 2030 paving the way and major global events on the horizon, this is the right time to buy properties in Saudi Arabia for your investment.