Luxury real estate investment and the impact of the Premium Residency Program
Architect Dr. Hisham Al-Qasim
<The Saudi real estate market, especially the luxury real estate sector, is experiencing rapid growth driven by multiple factors combining legislative reforms, major projects, and evolving demand patterns. One of the key drivers is the Premium Residency Program, which has provided foreigners and international investors with unprecedented opportunities for ownership and direct investment.<According to the Knight Frank 2024 report, Riyadh and Jeddah are seeing a marked increase in demand for luxury residential units, with real estate prices in Riyadh expected to rise by as much as 15-20% by 2026. Much of this growth is attributed to the entry of a new segment of foreign investors who have taken advantage of the privileges granted by the privileged residency program.
Privileged Residency Program. <The program not only grants the right to own property, but also opens the way for long-term investment in quality projects, such as tourist destinations (Red Sea, AlUla), and future cities (NEOM, The Line). These destinations are attracting investors looking for luxury, with the value of some luxury villas and apartments exceeding SAR 5 million, with a clear demand from investors from Europe, Asia and the Gulf.
Economically, estimates indicate that the value of some of the villas and apartments in these destinations exceeds SAR 5 million.
Economically, PwC estimates that the luxury real estate market in Saudi Arabia could grow at a rate of 8-10% per year through 2030, above the global average, driven by three key factors:
- Legal reforms: Such as privileged residency and enabling direct foreign ownership.
- Major national projects: That raise the value of surrounding areas.
- International and regional demand: The investor has come to view Saudi Arabia as a safe and stable investment destination.
While luxury real estate remains a symbol of luxury and quality of life, in Saudi Arabia it has also become a strategic tool to attract foreign capital and strengthen the Kingdom's position as one of the largest emerging real estate markets in the world.
