The latest analysis from Knight Frank reveals that the Saudi residential real estate market continued to move cautiously during the second quarter of 2026, despite improved activity compared to the first quarter, as affordability and regional uncertainty continue to weigh on buyers' decisions.
According to the report, the number of residential transactions across the Kingdom reached 45,740 transactions during the second quarter, an increase of 9% compared to the first quarter, but it remained 12% lower than the same period last year.
The total value of these transactions reached SAR 41.9 billion, a 61 TP3T increase quarter-on-quarter, but a 24.61 TP3T decrease compared to the second quarter of 2025. Faisal Durrani, Partner and Head of Research for the Middle East and North Africa at Knight Frank, said that the quarterly improvement in activity still comes within the context of a much weaker year-on-year performance, noting the continued impact of affordability and regional uncertainty on purchasing decisions. Residential land led market activity, recording 23,110 transactions, representing 50.51 TP3T of the total residential transactions, with a value of SAR 21.7 billion, or approximately 521 TP3T of the total transaction value.
In contrast, apartments accounted for 28.9% of total transactions, while villas accounted for 11.3%.
Knight Frank believes that the increased share of land necessitates a different interpretation of market figures, as land sales do not necessarily reflect the level of purchases of completed residential units. Furthermore, land trading activity is linked to changes in the development environment, whether through direct sales or partnerships between landowners and developers. In major cities, Riyadh recorded 10,667 residential transactions during the second quarter, a year-on-year decrease of 21,000 TP3T, compared to a growth of 231,000 TP3T compared to the first quarter. The value of these transactions reached SAR 14.3 billion, a year-on-year decrease of 141,000 TP3T and a quarter-on-quarter increase of 81,000 TP3T.
Jeddah recorded 6,669 transactions, a year-on-year decrease of 11 TP3T, while the value of transactions jumped 311 TP3T to SAR 10.3 billion. In the Dammam metropolitan area, the number of transactions rose 211 TP3T to 3,896, and their value increased 201 TP3T to SAR 4.9 billion.
Harman de Jong, regional partner and head of Middle East and North Africa consulting at Knight Frank, said that affordability, location, product quality and infrastructure are playing a bigger role in determining demand as the Saudi residential market becomes increasingly diverse.
