The real estate finance market in Saudi Arabia is witnessing a significant rise in loans granted by banks through 2025, reflecting continued strong demand for housing and real estate investment, amid economic developments and supported housing initiatives.

High loans support the housing market.

High loans support the housing market

The total real estate loans granted by banks by the end of the first quarter of 2025 amounted to about 922.2 billion riyals - an annual increase of about 15% - reflecting the growth of housing finance and the expansion of home ownership operations, as the proportion of residential loans reached 75.8% of total real estate financing, indicating that the majority of financial financing is directed to single families seeking housing, as confirmed by some official statistics.

Financing activity is increasing despite market volatility

Banks granted new home loans worth 34.1 billion riyals during the first months of 2025, up about 24% compared to the same period in 2024, according to some economic reports, reflecting households" willingness to take advantage of ownership opportunities despite economic pressures.

Some banking entities have also adjusted their financing policies to respond to the growing demand, offering facilities and easy terms, in support of housing and increasing Saudi home ownership.

Some banking entities have also adjusted their financing policies to respond to the growing demand, offering facilities and easy terms, in support of housing and increasing Saudi home ownership.

Real estate loans in Saudi Arabia 2025

Data from the Saudi Central Bank (SAMA) revealed that total real estate loans in the Kingdom exceeded SR950.6 billion by the end of the first quarter of 2025, recording an annual growth rate of 15%, while housing finance provided to individuals rose to SR698.8 billion, representing 75.8% of total loans by the end of the same period, while the sector recorded an additional jump in new residential lending during the first four months of 2025 worth SR34.1 billion, a growth rate of 24.1% year-on-year.

The sector recorded an additional jump in new residential lending during the first four months of 2025, amounting to SR34.1 billion, a growth rate of 24.1% year-on-year. On the other hand, financing for real estate companies continued to grow, reaching SAR 223.4 billion, driven by increased activity of developers and new urban projects, reflecting the state of recovery and expansion in conjunction with housing empowerment programs and the objectives of Saudi Vision 2030 to increase ownership rates and promote real estate investments.

Real estate financing reinvigorates real estate and investment

This momentum in lending is a major boost to the real estate market as it gives consumers higher purchasing power and stimulates investors and developers to launch new projects, and the increased real estate loans restore the dynamism of the sector - from buying residential units to developing land and equipping housing - which is reflected in the construction, finance and related services sectors.

Mortgage financing remains a viable option for real estate and investment. Mortgage financing remains a strategic option for many Saudi families looking for housing stability, as it is one of the drivers of real estate and economic activity, and if banks continue to maintain flexible financing policies and respond to the changing market, it is expected that mortgage financing will continue to play a pivotal role in achieving ownership and real estate development in the coming years.

Real estate financing will continue to play a pivotal role in achieving ownership and real estate development in the coming years.