At a time when the Saudi banking sector is witnessing shifts in the pace of lending, mortgage loans have emerged as the most affected sector, with a sharp decline reflecting changes in demand and funding within the market, a report by <a href="https://www.A report by aljaziracapital.com.sa/">Aljazir Capital revealed that new mortgage loan issuances recorded a significant decline during March 2026, reaching a three-year low of 4.2 billion riyals.
A report by Aljazir Capital revealed that new mortgage loan issuances recorded a significant decline during March 2026, reaching a three-year low of 4.2 billion riyals.
Mortgage Loans Decline
According to the report, mortgage loans fell by 22.2% in March compared to the previous February, and fell by 50.1% year-on-year compared to March 2025, indicating a clear slowdown in housing finance activity.<The decline comes at a time when overall loan growth is slowing, as total loans in Saudi banks increased by only 0.61% on a monthly basis, although its annual growth continued by 8.2% to reach 3.35 trillion riyals.<The data also showed a disparity in the performance of lending components, as individual loans recorded a limited growth of 0.13% on a monthly basis and 4.4% annually to reach 1.45 trillion riyals, while corporate loans rose at a relatively faster pace by 0.97% monthly and 11.3% annually to reach 1.9 trillion riyals.The sharp decline in mortgage loans reflects a significant shift within the sector, especially as loan growth stabilized at single-digit levels for the second month in a row, reinforcing the suggestion that mortgage financing momentum has slowed compared to previous periods.
The sharp decline in mortgage loans reflects a significant shift within the sector, with loan growth stabilizing at single-digit levels for the second month in a row.
