Luxury Property Market Insights in Saudi Arabia 2025

The Kingdom of Saudi Arabia is experiencing a luxury property renaissance. The luxury properties in Saudi Arabia sector is a market with a value of USD 15.1 billion in 2024 and is expected to grow to USD 25.7 billion by 2033, which makes it an attractive investment opportunity to investors and high-net-worth individuals who want to invest in high-quality real estate in one of the most vibrant markets in the Middle East.

This is a detailed report on the major drivers, market segments, and investment opportunities that define the luxury property market in Saudi Arabia as we progress into 2025.

Vision 2030: The Blueprint for Luxury Development

Economic Diversification at Scale

The main driver of the luxury property boom is the Vision 2030 program by the Saudi government. This grandiose scheme will spend more than 1 trillion dollars on infrastructure and housing, which will completely change the real estate market in the Kingdom.

The program aims at decreasing the reliance on oil revenues and making Saudi Arabia a global center of tourism, trade, and investment. This economic diversification plan has brought about unprecedented demand for luxury properties in Saudi Arabia especially in the major urban centers.

Government Reforms and Investment Incentives

The reforms in the regulatory environment have simplified the process of acquiring property by both local and foreign investors. The government has also opened up some sectors to 100 percent foreign ownership, which has made luxury real estate more open to international investors.

These reforms have brought in a lot of capital in the international markets with buyers in the Middle East, Europe and Asia focusing more on the high end properties in Riyadh and Jeddah.

Rising Affluence Drives Premium Demand

Growth in High-Net-Worth Individuals

The increasing number of high-net-worth individuals (HNWIs) and ultra-HNWIs in Saudi Arabia has created robust demand for premium properties. This affluent demographic seeks luxury accommodations that match their lifestyle expectations and investment requirements.

The wealth concentration in the big cities has especially favored the luxury apartment and villa sectors, where buyers are more interested in properties that provide exclusive facilities, good location, and high appreciation rates.

Changing Lifestyle Preferences

The contemporary Saudi customers are becoming more interested in the properties that offer the traditional luxury and modern conveniences. The luxury segment has come to expect smart home technology, sustainable design features, and exclusive community amenities.

Regional Market Analysis

Riyadh: The Capital Advantage

Riyadh is the leader in the luxury property market in terms of the number of transactions and price growth. In Q1 2025, the city recorded more than 10 percent price growth, and sales transactions rose by 51.6 percent in 2024.

The capital remains the political and business hub of the Kingdom, which continues to attract wealthy citizens and foreign investors. The major developments include luxury apartment complexes, high-end villa communities, and mixed-use developments that are aimed at high-income buyers.

Riyadh has a number of luxury neighborhoods, which provide high-end living. The King Fahd District is characterized by modern infrastructure and a lively environment. Olaya District is a busy commercial and luxurious area, where the luxurious houses are located close to the shopping malls and business centers. The Diplomatic Quarter is elite and peaceful, with parks and luxurious houses. Al Malqa District provides a modern lifestyle with luxurious houses near to the basic facilities.

Jeddah: Waterfront Luxury Hub

Jeddah has become one of the best places to own a luxury waterfront property. In Q2 2024, the apartment sales volumes in the city increased by 66.9 percent due to new tourism projects and infrastructure improvements.

The construction of the Jeddah Central Project and other Red Sea projects has made the city a luxury lifestyle destination. Sea view and waterfront properties are sold at high prices and are sought after by both local and foreign investors.

Dammam: Emerging Luxury Market

Dammam is developing as a luxury hub in the Eastern Province, benefiting from new infrastructure investments and improved connectivity. The city's proximity to major industrial centers and its growing business community have created demand for high-end residential properties.

Investment Opportunities by Property Type

Luxury Apartments and Condominiums

The luxury apartment segment has experienced significant growth, particularly in urban centers. These properties appeal to both local professionals and expatriates seeking modern amenities and convenient locations.

Investment opportunities are available in a variety of premium real estate projects. These include high-rise luxury towers located in bustling business districts, offering modern sophistication and prime locations. Additionally, waterfront condominiums are available, featuring stunning views and top-tier amenities designed for a luxurious lifestyle. Another option includes mixed-use developments that seamlessly combine residential and commercial spaces, creating vibrant, multi-functional communities..

Premium Villas and Landed Houses

Villas remain highly sought after in the luxury market, especially in prime locations and waterfront developments. These properties offer privacy, space, and customization options that appeal to ultra-high-net-worth buyers.

Popular villa developments offer a range of luxurious features designed to enhance comfort and exclusivity. Many include gated communities equipped with high-end amenities for a secure and private lifestyle. Waterfront properties often provide direct access to private beaches, creating an unparalleled connection to nature. Additionally, custom-designed homes are frequently situated in prestigious neighborhoods, offering a unique blend of elegance and sophistication.

Penthouses and Ultra-Luxury Units

The penthouse segment represents the pinnacle of luxury property investment in Saudi Arabia. These properties offer panoramic views, exclusive amenities, and prestige locations that command premium prices.

Market Performance and Price Trends

The prices of residential properties have been performing well, increasing by 5.1 percent year-on-year in the first quarter of 2025, with luxury properties in Saudi Arabia contributing to a significant portion of this growth. The luxury market in Riyadh has been especially remarkable, with the price growth being above 10%, which shows its outstanding performance in the industry.

The luxury property market has also been active in terms of transaction. The sales transactions in Riyadh increased by an impressive 51.6 percent in the course of 2024, which shows that buyers are confident and the market is liquid.

However, the average price per square meter decreased by 13 percent in the first half of 2025, despite the overall market growth. This decline can be explained by the fact that there is more supply of properties in the developing regions and a rising tendency to suburban luxury development, which is changing the supply and demand balance in the market.

Investment Considerations and Risk Factors

The luxury property market is volatile and is usually affected by the changes in oil prices and the world economic situation. Such volatility may be dangerous to investors and it is therefore advisable to diversify and think of long term holding periods to ride out the market fluctuations.

Moreover, the regulatory environment is also an important factor that influences the conditions of investment. Although the recent reforms have increased the accessibility to the market, the current changes in policies may influence the dynamics of luxury property investments. It is important to be aware of such policy changes in order to make effective investment planning and decision-making.

Another important determinant of the success of luxury property investments is infrastructure development. The prices of properties in new regions usually rely on the completion of infrastructure projects in time. Nevertheless, these projects may be delayed or changed in terms of development plans, which may affect the overall return on investment.

Emerging Trends and Future Outlook

The demand for smart home technology and sustainable design is transforming the luxury property market, with these innovative features driving up property values and attracting eco-conscious buyers. Luxury homes that integrate advanced technology and environmentally friendly elements are becoming increasingly desirable, reflecting a shift towards smarter and greener living.

Saudi Arabia's luxury property market is also becoming more connected with global real estate trends, as international buyers play a growing role in its development. This influx of global investors is fueling market expansion and bringing fresh perspectives to the Kingdom's luxury property sector.

Additionally, Saudi Arabia's strong focus on tourism is opening new opportunities for high-end real estate. Luxury properties that cater to both permanent residents and affluent tourists are in high demand. Mixed-use developments blending residential spaces with hospitality features are particularly popular, offering a seamless combination of living and leisure for a sophisticated audience.

Strategic Investment Recommendations

The luxury properties in the Saudi Arabia market offer compelling opportunities for investors seeking exposure to one of the world's most dynamic real estate markets. The combination of government support, economic diversification, and rising affluence creates a favorable environment for luxury property investment.

Key success factors for real estate investment involve several strategic considerations. One important aspect is focusing on properties located in well-established luxury districts, where demand and value are typically high. Another critical factor is identifying developments connected to major infrastructure projects, as these often drive growth and attract interest. Evaluating properties with unique amenities and standout features is also essential, as these elements can significantly enhance appeal and value. Additionally, staying informed about regulatory changes and economic developments is crucial to navigating the market effectively and making informed decisions..

The market's projected growth to USD 25.7 billion by 2033 reflects the Kingdom's transformation into a regional luxury real estate leader. Investors who position themselves strategically in this evolving market stand to benefit from both capital appreciation and the Kingdom's continued economic development.

As Saudi Arabia continues implementing Vision 2030 initiatives and developing mega projects, the luxury property market is expected to remain a key beneficiary of the Kingdom's ambitious transformation plans. Contact us to learn more about investment opportunities.