In the first week of 2023… a record decline in the Saudi real estate market

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The Saudi real estate market recorded a record weekly decline in the first week of trading this year, with a decline of nearly 54%, compared to the last week of last year.
The total value of market transactions at the end of the week settled at a level below 2.1 billion riyals.
The decline in real estate activity included all the main sectors of the market, as the value of deals in the residential sector decreased for the same week by 47.5%, and it decreased for the commercial sector by a record rate of 72.2%, and it decreased for the agricultural and industrial sectors by 22.7%, according to Al-Eqtisadiah newspaper.
The real estate market, like the rest of the markets, is going through a path facing weak liquidity flows to its various main sectors, as a result of the high interest rates (mortgages), and the subjection of valuations of various real estate assets to review by all parties, both investors and consumers, especially after the wave of hikes. The record achieved by the market over the past four years, in addition to studying the expectations related to the global economy and increasing the possibility of it entering a recession by the middle of this year, and the continuation of central banks around the world in the monetary tightening policies that they started at the end of the first quarter of last year, and are still valid. effect to date, and it is expected to continue with those strict policies until the middle or end of next year, according to statements issued by the US Federal Reserve, and most central banks around the world tracking the impact of those policies aimed at curbing the inflation rate, and returning it to its normal levels at 2.0% or less
The value of the residential sector deals recorded a record weekly decline of 47.5%, compared to its increase during the previous week by 19.0%, and it stabilized as a result of these developments at below the level of 1.4 billion riyals, 66.1% of the total value of weekly deals in the real estate market. Commercial sector transactions decreased by 72.2% for the second week in a row, compared to a decrease of 20.8% during the previous week, and subsequently settled at the level of 0.4 billion riyals, 20.2% of the total value of weekly transactions in the real estate market.

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