Data released bythe Saudi Central Bank “SAMA” revealed that mortgage loans provided by commercial banks in the Kingdom of Saudi Arabia recorded a significant increase of 11.7% by the end of the second quarter of 2024, representing an increase of 85.55 billion riyals compared to the same period last year.
The total volume of mortgage loans to individuals and companies reached 816.83 billion riyals, an all-time high, compared to 731.28 billion riyals at the end of the second quarter of 2023, according to SAMA data.
Growth on both an annual and quarterly basis
According to the data, mortgage loans rose by 2% on a quarterly basis compared to the end of the first quarter of 2024, reaching 800.46 billion riyals at that time, which means that loans granted during the second quarter alone totaled approximately 16.37 billion riyals. This growth reflects significant activity in the real estate market and increasing demand for mortgage financing.
Individuals Account for the Largest Share of Mortgage Loans
SAMA data also showed that individuals accounted for 78.56% of total real estate loans by the end of the second quarter of 2024, with a total value of 641.72 billion riyals, compared to 582.35 billion riyals in the same period last year. This represents a year-over-year growth of 10.2% and an increase of 59.37 billion riyals. Mortgage loans to individuals also rose by 2.6% compared to the first quarter of 2024, when they stood at 625.24 billion riyals.
Companies Record Notable Growth Despite a Slight Quarter-over-Quarter Decline
Mortgage loans to corporations also rose by 17.6% year-over-year, reaching 175.12 billion riyals by the end of the second quarter of 2024, compared to 148.93 billion riyals in the same period of the previous year, representing an increase of 26.19 billion riyals. However, loans granted to companies saw a slight decrease of 0.06% compared to the first quarter of this year, reaching 175.23 billion riyals.
Significant growth in mortgage loans over the past few years
Mortgage loans granted by commercial banks have seen significant growth over the past few years, rising from 200.4 billion riyals at the end of 2016 to:
210.99 billion riyals in 2017.
238.54 billion riyals in 2018.
297.37 billion riyals in 2019.
428.41 billion riyals in 2020.
568.86 billion riyals in 2021.
687.83 billion riyals in 2022.
767.27 billion riyals by the end of 2023.
This rapid growth reflects the increasing demand for real estate financing in the Kingdom and the expansion of the housing sector, and it reinforces efforts to achieve the goals of the Kingdom’s Vision 2030, which aims to raise the rate of home ownership among citizens to 70%. It also highlights the important role of commercial banks in supporting the real estate sector and providing appropriate financing solutions for individuals and companies, thereby contributing to driving economic development and achieving sustainability in the real estate market.
