The Saudi real estate sector is expected to see a “health correction” in 2019, following a sharp rise in real estate prices in the past few years, said Islam Bayaa, head of consultancy at KPMG Al Fozan & Partners in Saudi Arabia. He added that public and private sector initiatives to strengthen this sector are the main reason for this remarkable growth. The correction is expected to continue in the short term, but the market will rise in the medium to long term, given recent government initiatives to stimulate the sector, particularly the Ministry of Housing initiatives. In November, the Ministry of Housing launched the Population Program, which will provide 19,500 housing units for its citizens. The Kingdom also revealed real estate projects through public-private partnerships. The increase in real estate came in the form of investments by the state-owned public investment fund in the Kingdom, which launched several mega projects that are expected to contribute to the strengthening of the real estate sector. Or through the construction of the Riyadh Metro, where real estate increased due to developments near metro stations. Al Bayaa stressed that these companies will promote the real estate market in the newly developed sites, especially the concept of the second home in the Kingdom. In addition, some of these projects will include new asset classes that will increase real estate investment alternatives.
Growth of the Saudi real estate sector