Executive Summary
Saudi Arabia's economic momentum is expected to continue well into 2022 on back of expected increase in oil production. Economic activity in the Kingdom of Saudi Arabia (KSA) witnessed sharp rebound, registering real GDP growth of 7% in Q3 2021. Government spending on various infrastructure projects as a part of Vision 2030 program is expected to provide the necessary impetus for economic activity in non-oil sector. The rise in oil prices has improved government coffers and augurs well for economic outlook. The recently unveiled budget for 2022 projects a surplus, it's first since 2014. The KSA real estate price index rose by 0.5% in Q3 2021, mainly driven by a 1.3% y/y increase in residential land prices. Real estate land prices, which have been on a decline since 2015 have stabilized in recent quarters. The Saudi Arabian real estate market has made a strong recovery from the coronavirus-induced slowdown. The various measures taken by the government like ensuring home ownership for all, mandating regional headquarters for foreign companies has also given new impetus to the real estate sector. Also, other government initiatives like Sakani (enable Saudi citizens to own their first home) and Wafi (off-plan sales and rent program) boosted the demand for affordable homes.
