According to data from the Saudi Central Bank, or SAMA, this sum amounts to about 30% of all banks’ loans during the course of the three-month period.
The majority, or 79 percent, was made up of retail real estate loans, which increased by 10 percent to SR641.72 billion over this time.
Even while they made just 21% of the total, corporate real estate loans increased at a quicker annual rate of 18%, amounting to SR175.12 billion.
In recent years, the proportion of real estate loans in the overall loan portfolios of Saudi banks has been rising rapidly. Five years ago, these loans made up roughly 17% of all lending activities, according to SAMA data.
This percentage increased to 18.5% in 2021, 28.5 percent in 2022, and 29.6% in 2023. Real estate loans currently account for 29.7% of all loans as of the second quarter of this year.
Numerous important causes, such as urban development, changing lifestyle tastes, and the increase of e-commerce, are driving this growth. A growing focus on sustainability, a move toward remote work, changes in the population, and pro-remote government legislation are further factors.
Demand for a variety of property types, including residential flats and villas, business offices, and retail spaces, has increased noticeably in particular.
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