new residential mortgage financing for individuals in the Kingdom of Saudi Arabia saw a sharp decline during January and February of 2026, posting a 39.5% decline compared to the same period last year, according to data from the Saudi Central Bank (SAMA).
According to the data, the decline in financing value amounted to 7.82 billion riyals, reflecting increasing pressures on the local real estate market and a notable slowdown in demand for residential financing.
The total volume of new real estate financing provided to individuals by banks and finance companies reached 11.98 billion riyals during the first two months of this year, compared to 19.8 billion riyals in the same period of 2025.
At the same time, the number of financed contracts fell by 30.4% to 17.85 thousand contracts, compared to 25.64 thousand contracts in the same period last year, reflecting a significant decline in real estate activity at the start of the year.
Decline in Bank Financing
A breakdown of bank financing shows that the decline was even more pronounced, as financing fell by 40.32% to 11.56 billion riyals during the first two months of 2026, compared to 19.37 billion riyals in the same period of 2025.
The number of contracts financed by banks also fell by 31.03% to 17.36 thousand contracts, compared to 25.17 thousand contracts in the same period last year, representing a decrease of approximately 7.8 thousand contracts.
The data shows that financing was primarily directed toward the purchase of villas, totaling 7.50 billion riyals, while financing for apartment purchases amounted to 3.31 billion riyals, and 741 million riyals were allocated for land purchases during the same period.
Slight Decline in Corporate Financing
As for financing provided by finance companies, amounted to approximately 417 million riyals during the first two months of this year, compared to 422 million riyals in the corresponding period of 2025, marking a slight decrease of 1.14%, equivalent to 5 million riyals.
The financing facilities granted by finance companies were distributed as follows: 204 million riyals for the purchase of apartments, 179 million riyals for the purchase of villas, and 34 million riyals for land purchases, bringing the total number of contracts financed by these companies to more than 489 during the two-month period.
A review of annual performance shows that new real estate financing provided by banks declined by 11.7% in 2025 to reach 80.42 billion riyals, compared to 91.06 billion riyals in 2024, through the financing of 108,790 contracts.
The volume of financing from finance companies also declined by 3.2% over the past year to reach 2.5 billion riyals, compared to 2.56 billion riyals in 2024, through the financing of 2,790 contracts.
