Prices of Riyadh’s villas, apartments drop 3% in Q3: JLL

30/10/2018 Argaam Special

 

Sales prices of villas and apartments in Riyadh fell three percent year-on-year (YoY) in Q3 2018, according to JLL’s Q3 Riyadh Real Estate Market Overview.

 

Average rents also continued to drop, with marginal declines of 1 percent for apartments and 2 percent Y-o-Y for villas.

 

“The new contracts, which are considered legally binding and enforced, are likely to be a positive catalyst to the regulation and transparency of the residential sector,” JLL said.

 

Riyadh’s Residential Market (SAR mln)

Type

Rentals

Sales

Villas

(2.0%)

(3.0%)

Apartments

(1.0%)

(3.0%)

 

The total supply of residential units stood at 1.29 million units, with a further 7,000 units expected in Q4 2018.

 

Supply of Residential Units (mln units)

Year

Number of units

2015

1.19

2016

1.24

2017

1.26

Q3 2018

1.29

2018

1.30

2019

1.32

2020

1.35

 

Office rents eased four percent YoY in Q3 2018. Average rents currently reach SAR 1,248 per square meter, compared to SAR 1.297 per sqm a year earlier.

 

“The last quarter of 2018 is expected to see a more significant increase in the supply of office space, with nearly 153,000 sqm scheduled for completion,” the report added.

 

Office Spaces Supply in Riyadh

Year

GLA (mln Sqm)

2015

3.50

2016

3.70

2017

4.00

Q3 2018

4.10

2018

4.25

 

Going forward, Riyadh’s retail market is projected to see an increase in supply with over 388,000 sqm of retail gross leasable area (GLA) in the pipeline.

 

Total Retail Supply

Year

Area (mln Sqm)

2015

1.69

2016

1.84

2017

2.05

Q3 2018

2.14

2018

2.24

2019

2.63

2020

2.65

 

In the hotel market, almost 1,600 rooms and 800 serviced apartments are scheduled for completion by the end of this year.

 

“The hotel market in Riyadh did not witness any notable additions to the supply over Q3 2018. As such, the total hotel room stock in Riyadh remained unchanged at around 12,400 keys,” JLL added.

 

Average daily rates dropped six percent to USD 173 in the same period.

 

Riyadh’s Hotel Room Supply

Year

Number of rooms

(‘000 rooms)

2015

10.40

2016

11.30

2017

12.00

Q3 2018

12.40

2018

14.00

2019

16.30

2020

17.00

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