Data from the General Authority for Statistics revealed a 10.5% increase in residential rents in the Kingdom by 10.5% last March, driven by a 9.7% increase in villa rental prices. In its latest report, the General Authority for Statistics noted that this increase has a significant impact on the country’s annual inflation rate, given its substantial weight in the index, which stands at 21%.

The report also revealed that the real estate price index in the Kingdom of Saudi Arabia rose by 0.6% during the first quarter of 2024, compared to the same quarter of 2023, driven by a 1.2% increase in average residential sector prices.

According to the Statistics Authority’s report, the residential sector was affected by a 1.2% increase in residential land prices and a 0.8% increase in apartment prices, which is considered the main driver of the rise in real estate prices during the first quarter of 2024 due to its weight in the index.

Meanwhile, the report revealed a 0.2% decline in prices for residential buildings, a 2.3% decline for villas, and a 1.6% decline for houses. The Statistics Authority also reported a decline in prices for commercial real estate by 0.5% and for agricultural real estate by 0.1%.

It explained that the commercial sector was affected by a 0.5% decline in the prices of commercial land plots, as well as a 1.1% decline in the prices of commercial showrooms, while prices for commercial buildings and shopping centers remained stable in the first quarter of 2024, showing no significant change.

Meanwhile, the agricultural sector recorded a decline of 0.1% as a result of a 0.1% drop in agricultural land prices.

The report noted that, on a quarterly basis, the general real estate price index rose by 0.3% during the first quarter of 2024 compared to the fourth quarter of 2023.

Kalfat noted that the quarterly real estate index was influenced by a 0.4% increase in residential sector prices, driven by a 0.4% rise in residential land prices.

The index covers three main sectors comprising several real estate categories: the residential sector, which consists of the following categories (land plot, building, villa, apartment, and house); a commercial sector, comprising the following categories (land plots, buildings, showrooms/stores, and shopping centers), and an agricultural sector, which includes a single category: agricultural land.