In recent years, the real estate landscape in Saudi Arabia has witnessed a remarkable surge in off-plan property sales, showcasing a robust 52 percent increase in the first half of 2023 compared to the corresponding period last year. This emerging trend is reshaping the property market, driven by the allure of investing in properties before they are constructed or finalized.
Off-plan property sales entail a unique approach to real estate transactions, where buyers make investments based on architectural blueprints and specifications provided by developers. This innovative concept has garnered significant attention from both individual and institutional investors, contributing to the sector's substantial growth.
The Ministry of Municipal, Rural Affairs and Housing's off-plan sales and leasing committee, known as Wafi, has played a pivotal role in facilitating this surge. During the initial six months of 2023, Wafi licensed an impressive 47 off-plan sales projects. This surge in licensing can be attributed to Wafi's strategic efforts to invigorate the real estate sector, ensuring the availability of housing units that align with the preferences of Saudi families. A key objective within this initiative is to elevate residential ownership to 70 percent by 2030, harmonizing with the ambitious goals outlined in the Saudi Vision 2030.
Naif bin Nawaf Al-Sharif, the Secretary-General of Wafi, highlighted some significant statistics that underscore this burgeoning trend. Small and medium-sized projects, which obtained licenses, observed a remarkable 139 percent growth in the first half of 2023 compared to the corresponding period last year. This commendable growth translated into the licensing of 79 projects, ushering in a total of 1,832 new real estate units spanning across all regions of the country.
An equally noteworthy metric is the surge in the completion of projects during this time frame, boasting a staggering 130 percent growth rate. Al-Sharif further emphasized the expansion of off-plan developers, which increased by 9 percent compared to the first half of 2022. This development is underscored by the qualification of 174 real estate developers for diverse projects, underscoring the expanding landscape of investment opportunities in the Saudi Arabian property market.
As the trend of off-plan property sales continues to flourish, it serves as a testament to the evolving preferences and strategies within the real estate sector. With increased investor interest, facilitated by initiatives like Wafi, the Saudi Arabian property market is poised for transformation, redefining the ways in which properties are conceptualized, marketed, and acquired.