August 4, 2025 – Cheryl Arcibal, South China Morning Post
Saudi Arabia could replicate the success of Dubai in attracting foreign property investors, including those from Hong Kong and mainland China, following the kingdom’s relaxation of homebuying rules, according to experts.
A new law approved by the kingdom last month is set to allow non-Saudis to buy real estate in designated zones. The law will take effect in January.
“Saudi Arabia can absolutely succeed at making itself a major destination for investment and residency,” said Kashif Ansari, co-founder and CEO of real estate broker Juwai IQI. “The new law will give non-resident foreigners a clear path to own property in Saudi Arabia for the first time.”
Ansari said the Saudi capital of Riyadh and another major city, Jeddah, offer greater value than Dubai and Abu Dhabi in the United Arab Emirates (UAE). For comparably sized residential units, the average price per square foot in Jeddah is US$100 and in Riyadh, it is US$123. In Dubai, that figure rises to US$400.
Foreigners owned around 43 per cent of all homes in Dubai, according to data compiled by the think tank EU Tax Observatory. Sales of homes in Dubai worth more than 10 million dirhams (US$2.7 million) jumped tenfold to 4,670 in 2024 from 2020, according to data tracked by Savills. In the first quarter of this year, 1,300 such homes changed hands, up 31 per cent from a year earlier, the property consultancy added.
Chinese buyers accounted for 14 per cent of Dubai property sales so far this year, up from 13 per cent a year earlier, Savills said.
Meanwhile, Hong Kong and the UK were the top sources of ultra-wealthy individuals who owned a second home in Abu Dhabi, according to a study released last month by US-based Altrata, which tracks wealthy individuals.
Saudi Arabia’s property market was projected to nearly double in size from now to US$133 billion by 2033, according to Patricia Casaburi, CEO of Global Citizen Solutions, a boutique investment migration consultancy with offices in the UK, Portugal and Brazil.
“What really catches my attention are the rental yields,” Casaburi said. “At a 6.75 per cent average and with Riyadh hitting nearly 9 per cent, these returns significantly outperform most developed markets. Combine that with zero personal income tax, no capital gains tax and no inheritance tax and the net returns become even more attractive.”
Casaburi likened the kingdom’s plan to relax rules surrounding foreign property ownership to the evolution of Dubai’s market when it opened to international buyers. Liquidity and accessibility in the kingdom should increase, she said.
Under the Saudi Vision 2030 plan, the country is modernising and diversifying its economy to reduce its reliance on oil. The initiative included mega infrastructure projects such as The Line, a glass-panelled development billed as the crown jewel of Neom, a city that is being built in Tabuk province.
“Since the launch of the [plan], the real estate market in Saudi Arabia has grown noticeably,” said Jihad Elabbas, senior client adviser in the Middle East and North Africa at migration consultancy Henley & Partners.
“Heavy investment in infrastructure has been a key factor, including the new metro service in the capital and the upcoming opening of King Salman Park, which is said to be the largest urban park in the world,” he said.
Juwai IQI’s Ansari said Muslims were the most likely to invest, noting “significant pent-up demand among high-net-worth” individuals.
Investors based in Hong Kong and mainland China who have business interests in the kingdom might also be interested in buying homes there, Ansari said.
“Chinese companies are actively engaged in projects across Saudi Arabia and the local Chinese expat population is growing,” he said.
Between 2005 and June 2024, China invested US$53.85 billion in infrastructure projects in Saudi Arabia, according to data cited in January by the Carnegie Foundation, a US-based think tank.
Ansari said Saudi Arabia could further relax residency rules to attract foreign investors.
“Riyadh can unlock demand at scale from Greater China with more inviting residency rules,” Ansari said. “Crucially, Beijing and Hong Kong buyers will compare Saudi entry rules with Dubai’s. So, the two countries will be competing on their residency terms. With golden visa rules similar to those in the UAE, Saudi Arabia will be appealing to investors and to families looking for relocation or second-home status.”
Casaburi of Global Citizen said Dubai was appealing to lifestyle investors and those seeking established international communities, while Saudi Arabia was positioning itself to attract institutional money and family offices.
Saudi Arabia was moving steadily towards becoming a destination for wealthy families, said Elabbas of Henley.
“However, it is to be expected that the kingdom will take some time to catch up with its neighbour, the UAE,” he said.
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