The Best Investment in the Kingdom of Saudi Arabia: Guaranteed Future of Real Estate Investment

The Best Investment in the Kingdom of Saudi Arabia: Guaranteed Future of Real Estate Investment

The Kingdom re-invented its economic wheel with the establishment of Vision 2030 which seeks among other things to stop the dependence on oil revenue. This change significantly impacted the opportunities for investment in the Kingdom. The emphasis on other industries has contributed to Project NEOM and strengthened other industries such as gaming, hospitality, and real estate.

So, what has changed following the economic re-invention in the Kingdom:

The changes are indicative of unprecedented demand for prime offices in the Kingdom. The economic reforms have continued to shape the opportunities for investors in the commercial real estate sector.

Rental property investors also have a fair share of the pie due to the various opportunities for investment in the Kingdom:

  • In 2017, more than 1.6 million Saudis registered for government affordable housing.
  • To reach the anticipated housing stock of 4.96 million houses in 2030, there is a need for 1.2 million new homes in the Kingdom.

To realize the desired goal, the government embarked on increasing access to finance through:

  • Injection of SR6.5bn in Saudi Real Estate Refinance Company in 2018
  • Reduction of minimum down-payment to purchase a property from 30% to 5%.

With these initiatives, the Kingdom’s real estate became attractive to investors at the local and international levels. For example:

Investcorp Holdings, one of the largest asset management companies in the Middle East plans to invest $1 billion in the Kingdom in the next five years.

Crown Prince Mohammed bin Salman launched THE LINE, a $500 million project in June 2022.

These projects and investment trends are indicative of:

  • Increased government support for the real estate investment
  • Enhanced access to financial resources for investment in the RE sector
  • Growing demand for RE properties in the Kingdom
  • An attractive market for both local and internal investments.

Put in the words of Galsev, CEO of Realiste,

If you invest in Riyadh for example, buy 10, 20, apartments and leave it for five years, you can come back and it will have grown 100, 200, per cent.

In summary, the best investment for both long-term and short-term gains is an investment in the Kingdom’s RE sector.


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