Saudi Arabia construction and real estate market trends

In late 2026, Saudi Arabia experienced divergent trends across its construction and real estate sectors. Data from the General Authority for Statistics indicated significant price increases for construction materials, including electrical cables and wires, which rose by over 20%, and rebar, which saw increases exceeding 17% for most sizes.

While the real estate general price index rose by 1.3% in the second quarter of 2026, specific categories showed varied movement: villa prices decreased by 9.7%, residential land prices increased by 6.3%, the commercial sector declined by 3.2%, and the agricultural sector rose by 11.3%.

By September 2026, overall construction costs in the kingdom rose by 2.2% year-on-year, driven by higher expenses for labor, materials, energy, and equipment rental. This increase applied to both the non-residential (2.6%) and residential (2.1%) sectors. Despite these rising costs, construction activity expanded for a fifth consecutive month, with the Al Rajhi Capital Saudi Construction Index remaining above the 50-point threshold.