A Year After Crown Prince’s Decisions, Riyadh Real Estate Exits Speculation, Transaction Values Down 64%

One year after Crown Prince Mohammed bin Salman issued a package of decisions on March 29, 2025 to rebalance Riyadh’s real estate market, transaction values in the capital have plunged 64%, signaling a decisive end to the speculation that drove prices higher in previous years. Data from the Real Estate Exchange affiliated with the Ministry of Justice show transactions falling to roughly 53,000 deals worth more than $17.3 billion (65 billion riyals) in the year since the decisions, compared with about $48.3 billion (181 billion riyals) in the prior year; total traded land area declined to 153,000 square meters from 228,000 square meters.

"The decline in transaction values does not reflect weak activity as much as it reflects a retreat in speculative practices that had pushed prices beyond levels linked to real housing demand," said real estate expert and marketer Saqr Al-Zahrani. He added that supported land offerings at around 1,500 riyals per square meter have "reset price expectations" in several districts and helped curb unjustified increases.

Context and policy measures

The Crown Prince’s directives introduced a set of executive measures aimed at shifting market incentives away from land hoarding and short-term trading and toward development and housing supply. Key measures included lifting restrictions on millions of square meters in northern Riyadh, activating fees on vacant land to boost housing supply, freezing rent increases, and regulating contractual relations between landlords and tenants. Market observers say those steps have directly contributed to stabilising housing costs and curbing abrupt price surges.

• Transaction values: down 64% to more than $17.3 billion (65 billion riyals) versus approximately $48.3 billion (181 billion riyals) the prior year.
• Deal count: around 53,000 transactions in the year following the directives.
• Traded land area: 153,000 square meters, down from 228,000 square meters.
• Supported land pricing: offerings at about 1,500 riyals per square meter cited as a new pricing benchmark.

Experts interviewed by Asharq Al-Awsat describe a structural shift in market behaviour. Al-Zahrani said undeveloped land in northern Riyadh has experienced what he described as a "free fall" in prices after years of rapid increases driven by speculation and growth expectations. He and others point to a migration of liquidity from large-scale land speculation to organised residential development projects and the re-emergence of the genuine homebuyer as the main driver of demand.

Outlook

Abdullah Al-Mousa, another real estate expert and marketer, characterised the current phase as a recalibration rather than a downturn. "What is happening in Riyadh’s real estate market today does not represent a downturn but a transitional phase reshaping market rules — from one driven by price speculation to a more mature and stable market based on real asset value and long-term development efficiency," he said. Market participants expect an expansion of off‑plan projects, longer payment plans from developers, and the imminent roll‑out of fees on vacant properties to activate idle assets.

Taken together, officials and specialists say the reforms mark a deliberate move to align Riyadh’s property stock with genuine housing needs and long‑term urban development goals, with northern districts at the centre of the market’s new trajectory.