In an indicator reflecting the increasing activity in the real estate finance sector, Saudi banks recorded a significant rise in the volume of new residential mortgage financing provided to individuals during September 2024, indicating positive shifts in the real estate market despite economic challenges.
Data released by the Saudi Central Bank (SAMA) showed a rise in the volume of new residential mortgage financing provided by banks to individuals during September 2024, indicating positive shifts in the real estate market despite economic challenges. Data released by Saudi Central Bank (SAMA) showed that the volume of new residential real estate financing provided by banks to individuals during September 2024, reaching 6.82 billion riyals, recording an increase of 17% compared to the same month of the previous year.
Data released by Saudi Central Bank (SAMA) SAMA data showed that the total contracts concluded between banks and individuals during the same month amounted to about 9.32 thousand contracts, reflecting the growth in demand for housing finance and the increasing trend towards home purchase.
Residential villas dominated the largest share of the total financing provided by banks during September 2024, amounting to 3.88 billion riyals compared to 3.79 billion riyals at the end of last August, equivalent to 57% of the total financing. Apartments ranked second with financing of 2.54 billion riyals compared to 2.44 billion riyals at the end of last August, followed by lands worth 397 million riyals compared to 362 million riyals at the end of last August. On the other hand, Real estate financing Residential financing provided to individuals by financing companies decreased by 24% during September, reaching only 202 million riyals, reflecting the challenges facing these companies compared to banks in providing attractive financing offers to individuals.
Data from the National Bank of Saudi Arabia (NBKA) showed that residential financing ranked second with 2.54 billion riyals, compared to 2.44 billion riyals at the end of August. <According to SAMA data, the total real estate loans provided by commercial banks rose to 814.64 billion riyals by the end of the second quarter of 2024, compared to 88.46 billion riyals at the end of the first quarter of the same year. The volume of loans to individuals amounted to SAR 639.52 billion at the end of the second quarter, compared to SAR 625.24 billion at the end of the first quarter. As for real estate loans allocated to companies, they recorded 175.11 billion riyals at the end of the second quarter, compared to 175.22 billion riyals at the end of the first quarter of 2024.
This remarkable rise in bank financing reinforces expectations of continued growth in the real estate sector, driven by individuals“ preference for villas and apartments as primary housing options, while the corporate financing market remains in need of new attraction strategies to boost its share.
