The results of the “real estate balance” decisions in Saudi Arabia began to reflect clearly on the market movement, with a decline in real estate prices during the first quarter of 2026, in a remarkable shift that reflects the increased supply and adjusting the rhythm between supply and demand, especially in cities that witnessed a price boom during the past years.
Data General Authority for Statistics showed that the real estate price index in the Kingdom decreased by 1.6% during the first quarter of 2026 compared to the same period in 2025, in a direct reference to the impact of the regulatory decisions aimed at rebalancing the real estate market, especially the measures applied in the city of Riyadh.
Experts believe that these declines are a direct result of policies to increase supply, whether through the liberalization of land, the introduction of thousands of residential plots at specific prices, as well as the amendment of the white land fee system, steps aimed at curbing the rapid rises witnessed by the market in recent years.
Residential Sector Price Decline
The residential sector, which represents the largest weight in the index at 72.7%, recorded the most prominent decline with a decrease of 3.6%, driven by a drop in residential land prices by 3.9%, a decline in villa prices by 6.1%, in addition to a decline in apartment prices by 1.1%, while residential floors recorded a slight increase of 0.6%.
Residential floors recorded a slight increase in prices by 0.6%.
At the regional level, several regions witnessed clear price declines, with Al-Baha region recording the largest decline of 9.2%, followed by Hail with 8.0%, and Northern Borders with 6.6%. Prices in Qassim fell by 5.1%, Medina by 5.0%, while prices in Riyadh fell by 4.4%, reflecting the direct impact of the real estate balance decisions that targeted the capital in particular.
Mecca, Jizan and Al-Jouf also witnessed less severe decreases ranging between 0.7% and 1.4%, indicating a wider impact to include several markets within the Kingdom.
In contrast, some regions recorded price increases, with Eastern Province topping the list by 6.9%.9%, followed by Najran at 3.5%, Tabuk at 1.5%, and Asir at 1.1%.
Decisions to restructure the real estate market
The roots of this shift go back to a package of decisions issued in March 2025, aimed at restructuring the real estate market, including lifting the suspension of the development of large areas north of Riyadh, providing between 10 to 40 thousand land plots annually at prices not exceeding 1500 riyals per meter, in addition to regulating the relationship between landlords and tenants, and stopping the increase in residential rents in Riyadh for 5 years starting from September 2025.<The amendment of the white land fee system also contributed to stimulating the development of unused land and increasing the supply by imposing fees on vacant land and unused real estate, thus enhancing market efficiency and limiting monopoly.
These efforts were reinforced by the launch of the "Real Estate Balance" platform to facilitate citizens' access to residential land within an organized framework that ensures justice in distribution, along with government plans to expand the housing supply through support programs and provide tens of thousands of housing units in partnership with the private sector.
The housing support programs have also contributed to enhancing supply, as the Ministry of Municipalities and Housing aims to expand support to include 100 percent of the housing stock.
