Bank financing has contributed to the revival of the real estate sector in Saudi Arabia, especially in light of the legislation and financial policies that supported the citizens" tendency to own a home, as it can be said that real estate bank financing in Saudi Arabia is witnessing an unprecedented stage of growth, although it faces some challenges that officials seek to overcome with new policies.

Real estate financing in Saudi Arabia is witnessing an unprecedented stage of growth, although it faces some challenges that officials seek to overcome with new policies.

Real Estate Finance Performance

The volume of real estate loans granted by Saudi banks amounted to about 883.3 billion riyals, and this amount was divided between individuals, projects and companies, with 77.13% directed to individuals and 26.23% directed to real estate loans for companies and institutions.

According to a report by Al Arabiya, new residential real estate financing provided to individuals reached 11.94 billion riyals per month in December 2024, its highest level since August 2022, and in the same period villas accounted for 68% of the total new financing for individuals, followed by apartments and then land, according to a report by Al Eqtisadiah.

A report by Al Eqtisadiah revealed.

Housing Support Programs and Real Estate Development Fund Financing

The Real Estate Development Fund announced, according to Al-Arabiya, that mortgage financing for beneficiaries of housing support programs increased about 16.4% during 2024, where 12,340 contracts were signed, and the volume of financing amounted to about 9.38 billion riyals.

There are a number of factors that increase expectations that bank real estate financing will witness greater expansion, including the reduction of interest rates, which made financing more attractive, especially for individuals, which is evident in the high percentage of residential loans, and the Kingdom provides direct support through affordable housing programs, the Real Estate Development Fund, and the Sakani program, so it is expected that the growth of real estate loans, especially residential, will continue.