Survey reveals strong desire to climb property ladder
The future home ownership aspirations of our Saudi residential survey respondents have revealed some fascinating differences.
2 minutes to read
In our Saudi residential survey, 84% of tenants stated their desire to purchase a home in the next 12 months. Interestingly, the vast majority prioritized apartments (48%) over branded residences and villas. Whereas for existing homeowners, the appetite to buy a villa (44%) is higher than apartments (14%).
Amongst tenants, apartments (48%) are more highly coveted as a first home when compared to villas (31%). While branded residences appear to be the least popular option (5%), we feel this is reflective of the lack of branded residential stock in the market. Indeed, in Riyadh, there are just a handful of branded residential properties, which form a negligible proportion of all the units in the city.
Overall, 84% of tenants say they will want to make a purchase in the next 12 months. Those living with their parents (90%) have the strongest desire to buy their own home, while almost irrespective of monthly income bracket, the desire to transition to homeownership ranges from 88% (<SAR 20,000) to 92% (>SAR 60,000).
Amongst existing homeowners, who are planning to either upgrade their homes, or buy a second home, the appetite to purchase a villa (44%) is perhaps unsurprisingly higher than apartments (41%). Dammam’s homeowners have the highest appetite for branded residential property at 15%.
“84% of tenants will make a property purchase within 12-months”
Budgets amongst homeowners are higher than their tenant counterparts, with 29% saying they will spend upwards of SAR 3 million on their next purchase (>US$ 800,000), which bodes well for all the planned Giga projects in the Kingdom, all of which are believed to have starting price points of close to US$ 1 million. While this clearly indicates the presence of a second homes market in the Kingdom, there is a risk of an oversupply of luxury homes in the future should all developers target this relatively small segment of the population.
