Dubai: Apartment prices in Saudi Arabia increased at the fastest pace in five years, spurred by a government plan to boost home ownership by building affordable housing and offering cheap loans.
In the capital, Riyadh, and the Red Sea port city of Jeddah, apartment values increased 17% and 12% respectively over the past 12 months, according to data by global property consultant Knight Frank.
"Home ownership has actually become more affordable since the launch of the National Transformational Plan," said Faisal Durrani, head of Middle East research at Knight Frank, referring to Crown Prince Mohammed bin Salman's plan to wean the economy off oil. "Two-bedroom apartments for instance, on average, cost 2.4 times annual incomes, compared to a multiplier of 2.7 back in 2016, well within globally accepted affordability thresholds."
Prices of single-family homes aren't rising as quickly as apartments, partly because they cost anywhere between seven to 12 times annual incomes, Durrani said.
The kingdom aims to lift home ownership to 70% in 2030 from about 60% today.
