In a decisive move to tackle rising property costs and improve homeownership, Saudi Arabia has launched a major initiative offering residential land at massive discounts in its capital, Riyadh. The program, featuring price cuts as steep as 84%, aims to reshape the city's housing market and make owning a home a reality for more citizens.
Historic Land Lottery and Steep Price Cuts
On Wednesday, the Royal Commission for Riyadh City conducted a significant electronic lottery via the Real Estate Balance platform. This event distributed a total of 10,024 residential plots covering 6.38 million square meters across eight key neighborhoods: Al-Qirawan, Al-Malqa, Al-Nakheel, Al-Narjis, Namar, Al-Rimayah, Al-Rimal, and Al-Janadriyah. Each plot measures a standard 300 square meters.
The fixed price for this land was set at SR1,500 per square meter. This represents a dramatic reduction from prevailing market rates, with discounts ranging from 16% to an astonishing 84% depending on the area. On average, plots are priced more than 50% below Riyadh's current average residential land price of SR3,200 per square meter.
Al-Qirawan neighborhood received the deepest discount at 84%, followed by Al-Malqa and Al-Narjis at 78%. Al-Rimal saw a 58% reduction, while Al-Janadriyah had a 16% discount.
Eligibility and Rules to Curb Speculation
This ambitious scheme is a cornerstone of Crown Prince Mohammed bin Salman's five-point strategy to stabilize Riyadh's real estate sector after years of rapid price growth. The Royal Commission plans to supply between 10,000 and 40,000 fully developed plots annually for the next five years, all priced below the SR1,500 benchmark.
Eligibility is specifically targeted:
- Married Saudi citizens.
- Or unmarried Saudi citizens aged 25 and above.
- Applicants must not already own residential property.
To prevent land speculation and ensure the plots are used for their intended purpose, the government has imposed strict conditions. Beneficiaries cannot sell, rent, mortgage, or otherwise dispose of the land for 10 years, with an exception only for securing construction financing. If a plot remains undeveloped within this decade, it will be reclaimed by the authorities, with the original purchase price refunded to the owner.
Broader Strategy for Market Stability
Beyond the discounted land offers, Saudi authorities have rolled out several complementary measures designed to cool the housing market and ensure long-term stability:
- Lifting development restrictions on over 81.48 square kilometers of land in northern Riyadh.
- Restructuring the white land fee system to encourage faster development.
- Freezing any increases in residential rents for a period of five years.
- Publishing regular reports on land and housing prices to promote market transparency.
Housing experts estimate that Riyadh requires between 100,000 and 130,000 new housing units every year to meet growing demand. The government is reportedly looking at successful large-scale housing models from various Asian cities as benchmarks for effective and rapid implementation.
The combined package of measures seeks not just to expand housing supply but to fundamentally improve affordability and quality of life for Riyadh's residents. By simultaneously addressing land availability, controlling prices, and preventing speculation, the initiative supports the long-term goals of urban sustainability and economic stability in the Saudi capital.
