Saudi Real Estate Market Rallies on New Foreign Investment Rules

BearMarketBard · 2026-02-06T21:21:14+00:00

The Saudi real estate sector gained momentum after the government liberalized property ownership regulations, leading to a surge in shares of major developers. The new framework allows foreign investors to own various types of properties, enhancing investment opportunities and supporting economic diversification.

BearMarketBard

2026-02-06 21:21:14

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The Saudi real estate sector experienced significant momentum following the government’s decision to liberalize property ownership regulations. Shares in major real estate developers climbed sharply as investors responded positively to expanded opportunities for foreign capital in the kingdom’s real estate market.

Market Performance Reflects Strong Investor Appetite

The Tadawul Real Estate Management & Development Index surged 4.5%, with all 17 listed companies posting gains on recent trading. Makkah Construction & Development Co. led the advance with nearly a 10% jump, while Dar Al Arkan Real Estate also saw substantial increases. This sector-wide rally contributed to the broader Saudi stock market’s positive performance, marking consecutive days of gains and positioning the index for a strong start to the year following its weakest annual performance in a decade.

“The market is clearly hungry for growth catalysts,” noted Fadi Arbid, founding partner and chief investment officer at Amwal Capital Partners. “Opening up real estate opportunities, particularly in the sacred cities, provides a meaningful catalyst for the sector.”

Policy Shift Opens New Frontiers for Foreign Investors

Saudi regulators recently began accepting applications from foreign nationals seeking to invest in domestic real estate. The updated framework now permits non-citizens to own residential, commercial, agricultural, and industrial properties across major cities including Riyadh, Jeddah, Mecca, and Madinah—areas where ownership was previously restricted primarily to Muslim citizens and Saudi-controlled entities.

This policy revision represents a significant departure from previous restrictions and aligns with the kingdom’s broader initiative to attract international capital. Saudi Arabia refined its property ownership framework to draw foreign investors while simultaneously supporting infrastructure expansion that underpins the country’s economic diversification strategy beyond petroleum.

The government has also signaled plans to grant foreign investors broader access to the Saudi stock market beginning February, further signaling the kingdom’s commitment to opening its financial ecosystem to international participation.

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