Invest in Saudi Arabia: Real Estate Prices Drop in Mecca and Riyadh

Published July 2nd, 2017 - 11:51 GMT
Foreign laborers work at a construction site in Riyadh on October 30, 2013. (Fayez Nurelddine/ AFP)
Foreign laborers work at a construction site in Riyadh on October 30, 2013. (Fayez Nurelddine/ AFP)

Official statistics from the Saudi Ministry of Justice revealed that the average price of privately-owned apartments dropped by 17 percent during the holy month of Ramadan in Makkah and 11 percent in Riyadh.

Prices in Dammam and Jeddah witnessed a slight increase of 3.5 percent and 0.7 percent respectively, Al-Madina newspaper reported.

The data showed the average price of land dropped in Riyadh by 14 percent and in Makkah by 3 percent while in Dammam it increased by 17 percent and 7 percent in Jeddah.

According to the real estate index of the ministry, the average price of privately-owned apartments during Ramadan in Riyadh was SR558,000, in Makkah SR536,000, in Jeddah SR567,000, and in Dammam SR591,000, while the average price last year was SR630,000 in Riyadh, SR650,000 in Makkah, SR536,000 in Jeddah and SR571,000 in Dammam.

There was no increase in the average price of land in Riyadh compared to last year when it stabilized at SR874,000 after rising to more than 1 million the previous year. In Makkah, price of land dropped to SR3.1 million this Ramadan from SR3.2 million last year. In Jeddah the price remained stagnant at SR1.5 million.

Chairman of the Real Estate Committee in the Jeddah Chamber of Commerce and Industry (JCCI) Khalid Al-Ghamdi ruled out a general drop in the prices of real estate, especially land, in major cities of the Kingdom in 2017.

He pointed out that the current prices reflect the logical and real price of property, stressing that this year is «a year of stability» in the sector.

He, however, added: «The prices of real estate outside the cities, especially in areas where there are no basic services, such as electricity and water, may see a decline of 10 to 15 percent during the current year.»

Al-Ghamdi said real estate prices, particularly land, will not decline or rise in 2017 and 2018 in major cities from their current levels.

 


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