Figures reveal a strong Saudi appetite for branded residential real estate, with more than 3.57 billion riyals expected to be pumped into this promising sector in the coming years. In a new survey conducted by Knight Frank in partnership with YouGov, there is a strong desire among Saudis to own branded luxury homes, reflecting a dramatic shift in buyer preferences and revealing tremendous growth opportunities in this rapidly evolving sector.
A new survey conducted by Knight Frank in partnership with YouGov shows a strong desire among Saudis to own branded homes, reflecting a dramatic shift in buyer preferences and revealing tremendous growth opportunities in this rapidly evolving sector. According to the Knight Frank and YouGov survey, Saudi nationals plan to spend 3.38 billion riyals ($902.8 million) on branded homes, while expatriates are expected to spend 1,037 million riyals ($50 million) on residential properties of this type.
According to the Knight Frank and YouGov survey, Saudi nationals plan to spend 3.38 billion riyals ($902.8 million) on branded homes. <There appears to be a strong correlation between Saudis" willingness to buy these types of homes and their income level. While 81% of citizens earning more than 50,000 riyals per month are considered ”likely“ to buy a branded home, this trend increases for those earning between 60-70,000 riyals, where the percentage of interest reaches 89%.
While 81% of citizens earning more than 50,000 riyals per month are considered ”likely“ to buy a branded home, this trend increases for those earning between 60-70,000 riyals per month.
Significant growth in the residential sector market
Faisal Durrani, Partner and Head of Research at Knight Frank MENA, noted that the branded residential real estate sector in Saudi Arabia has seen significant growth, with locations such as Diriyah Gate, AlUla and Jeddah emerging as key destinations for operators and developers. The sector, which was relatively small in the past, is undergoing a rapid transformation due to factors such as prestige and virtual guarantees of world-class facilities. These homes are one of the most attractive options for buyers looking for a premium lifestyle experience, offering many benefits such as access to world-class hotel services including pool, gym and spa, as well as room service and housekeeping.
Challenges of rising prices
Despite this growth, Saudis face some challenges when it comes to buying branded homes, especially with their higher prices compared to regular real estate. In Riyadh, prices for these properties range from SAR 65,000 per square meter, well above the market average for non-branded properties, which are priced around SAR 5.5,000 per square meter.
According to experts. <According to experts, one of the biggest barriers that may prevent Saudis and expats from buying branded homes in the near future is the high cost, with 39% of respondents considering that the availability of bank financing schemes may contribute to greater buyer attraction. This trend is most noticeable among expats who are looking for greater support from local banks.
Market trends and developer needs
Despite growing interest, the Saudi market remains limited in terms of the number of branded properties available. There are currently only around 1775 branded residential units in Saudi Arabia, with an additional 2500 units scheduled to be built by 2028. These figures point to a significant opportunity for developers to meet the growing demand by providing a variety of options in this sector.
Mohammad Ait said. <Mohammed Itani, Partner and Head of Sales and Marketing at Residential Projects, noted that one of the factors hindering the growth of this sector is the limited options available. Therefore, he believes that developers should work to increase diversity in this market to ensure a wider appeal to different social groups.
Developers should work to increase diversity in this market to ensure a wider appeal to different social groups.
