Buying Your First Home in Saudi Arabia: Complete Guide 2026
Table of Contents
Saudi Real Estate Market 2026 & Vision 2030
Saudi Arabia's real estate market is experiencing significant growth in 2026, driven by Vision 2030's goal to raise homeownership rates to 70%. Massive infrastructure investments and mega-projects like NEOM and the Red Sea Project are boosting housing demand.
70%
Homeownership target by 2030
63%
Current ownership rate 2026
600K+
Families supported by Sakani
Property prices have generally increased in recent years, especially in Riyadh and Jeddah, making early planning and leveraging government support programs essential for first-time buyers.
Sakani Program & Real Estate Development Fund (REDF)
Sakani is the main government initiative supporting homeownership in Saudi Arabia. It offers several options including free land plots, ready units, under-construction units, and subsidized financing in partnership with the Real Estate Development Fund (REDF).
| Support Type | Details | Key Requirements |
|---|---|---|
| Subsidized Financing | Government covers financing profits up to 500,000 SAR | Saudi, 25+, no existing home |
| Free Land | Developed residential land in various locations | Build within 2 years of allocation |
| Ready Units | Move-in ready apartments and villas at subsidized prices | Subject to availability in area |
| Self-Build | Financing to build on your own land up to 500,000 SAR | Ownership of buildable land |
Mortgage Options: Murabaha vs Conventional
Saudi banks offer two main types of mortgage financing. Most products are Sharia-compliant and operate through Murabaha or Ijara (lease-to-own) structures.
Murabaha Financing
- Bank buys property and sells it to you at agreed profit
- Fixed installments throughout the financing period
- Sharia-compliant
- No surprises in monthly payment amount
- Profit margin ranges from 4.5% - 6.5%
Ijara (Lease-to-Own)
- Bank owns property and leases it to you
- Payments may vary based on SAIBOR rate
- Ownership transfers upon final payment
- Greater flexibility in refinancing
- Rate starts from 3.99% variable
| Bank | Profit Rate | Max Term | Max Financing |
|---|---|---|---|
| Al Rajhi Bank | 4.65% | 30 years | 5M SAR |
| SNB (National Bank) | 4.49% | 30 years | 7M SAR |
| Riyad Bank | 4.75% | 25 years | 5M SAR |
| Banque Saudi Fransi | 4.55% | 30 years | 5M SAR |
* Rates are approximate and subject to change. Contact the bank for the latest rates.
Down Payment & Hidden Costs
The property price is not the only cost when buying a home. There are additional fees and expenses you must factor into your budget planning.
Cost Breakdown for a 1,000,000 SAR Property
| Down Payment (10%) | 100,000 SAR |
| RETT - Real Estate Transaction Tax (5%) | 50,000 SAR * |
| Property Valuation Fee | 2,000 - 5,000 SAR |
| Bank Administrative Fee | 1% (up to 5,000 SAR) |
| Property Insurance (annual) | 1,500 - 3,000 SAR |
| Ownership Transfer & Notary Fees | 1,000 - 2,000 SAR |
| Approximate Total Upfront Required | 155,000 - 165,000 SAR |
* First home up to 1M SAR is exempt from RETT under the government relief initiative.
Best Cities to Buy: Price Comparison
Property prices vary significantly by city and location within each city. Here is a comparison of average apartment and villa prices in major Saudi cities.
| City | Apartment (Avg) | Villa (Avg) | Price per sqm |
|---|---|---|---|
| Riyadh | 650K - 1.2M SAR | 1.2M - 3.5M SAR | 3,500 - 7,000 SAR |
| Jeddah | 500K - 1M SAR | 1M - 3M SAR | 3,000 - 6,500 SAR |
| Dammam | 400K - 800K SAR | 800K - 2M SAR | 2,500 - 5,000 SAR |
| Khobar | 450K - 900K SAR | 900K - 2.5M SAR | 2,800 - 5,500 SAR |
| Madinah | 350K - 700K SAR | 700K - 1.8M SAR | 2,200 - 4,500 SAR |
* Prices are 2026 estimates and vary by neighborhood, size, and build quality.
Tips for First-Time Buyers
1.Set Your Budget Accurately
Keep monthly payments under 30% of your income. Calculate all additional costs in advance.
2.Compare Bank Offers
Get offers from at least 3 banks. A small difference in profit margin saves thousands of SAR.
3.Inspect the Property Thoroughly
Hire a certified engineer to inspect. Check plumbing, electrical, insulation, and build quality.
4.Verify the Electronic Deed
Ensure the property has an updated electronic deed via the Ministry of Justice. Avoid old paper deeds.
5.Study Location & Amenities
Check proximity to schools, hospitals, and transport. Visit the area at different times.
6.Don't Rush Your Decision
Take your time to research and compare. Visit at least 10 properties before making a final choice.
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Hijri Calendars Team
A specialized team providing comprehensive and updated guides on Saudi real estate and financial services. We help citizens and residents make informed financial decisions.