RIYADH: New residential mortgage loans from Saudi banks totalled SR7.07 billion ($1.9 billion) in July, up 33% from the previous month, according to recent data. According to data released by SAMA, the Saudi Central Bank, there were 9,605 loan contracts in October compared to 7,274 the previous month.
The main purpose of these residential loans is to buy homes, apartments, and land. The bulk, SR4.38 billion, or 62 percent, was set aside for home purchases. Although home loans increased by 28% every month, their proportion of the residential mortgage market fell from 72% to 62% a year ago.
Even though they made up the smallest percentage 6% Loans for buying land experienced the fastest monthly growth rate—they increased by 63 percent to SR429 million. The move in lending towards apartments indicates Saudi Arabia’s shifting demographic and economic patterns.
Although villas continue to symbolise aspiration, more buyers are choosing apartments due to affordability, especially in cities like Riyadh, where real estate prices are rising steadily.
Many now find apartments a more feasible option due to the erosion of purchasing power caused by rising borrowing costs. Riyadh’s estimated population growth, which is anticipated to reach 15–20 million by 2030, increases demand, especially for smaller, more reasonably priced homes and rental units.
Apart from that, the capital’s growing population of foreign and local migrants is generating a varied housing market in which apartments are becoming increasingly in demand, which is increasing the proportion of new residential loans.
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