Expats in Saudi Arabia are looking to invest in real estate, with a spending pot totalling $863 million. According to Knight Frank, NEOM is the preferred destination for these investments.
The Knight Frank Destination Saudi report further states that 29% of expats in Saudi Arabia want to buy a home in NEOM. Jeddah Central followed with 15%, and King Salman Park with 8% interest from expat investors. This makes NEOM the most preferred choice among giga projects in Saudi Arabia.
KNIGHT FRANK DESTINATION SAUDI SURVEY INSIGHTS
Knight Frank surveyed 241 expatriates to gauge their interest in real estate investment in the Kingdom. Of these, 56% have lived in Saudi Arabia for over a decade and 76% work in the private sector.
WHAT MAKES NEOM ATTRACTIVE?
Faisal Durrani, the Head of Research at Knight Frank MENA, says NEOM's attractiveness comes from its futuristic features and ambitious construction projects. He believes these aspects draw people to the area.
BUDGET PREFERENCES AND LIKELIHOOD OF PURCHASE
Expats in Saudi Arabia have clear budget preferences for real estate investment. While 87% are willing to spend under $933,000, a significant part, 32%, aims for properties under $200,000. Yet, despite the expectation of giga project properties fetching a price tag of above $1 million, 41% of expats with budgets under $1 million remain interested. They are open to reconsidering their budgets.
FACTORS DRIVING PURCHASE DECISIONS
Encouragingly, 72% of expats plan to buy a home in their preferred giga project. On average, expats are willing to spend $720,000 on a giga project home, which is higher than in other parts of the Kingdom. Millennial expats have the highest average budgets, at $1.1 million.
SPENDING POWER AND PREMIUM GIGA PROJECTS
Expats in Saudi Arabia's capital, Riyadh, have a combined spending power of $152 million. This translates to a potential capital of $863 million in the city. Moreover, 32% of expats are willing to pay a premium of 2.5-5% above market rates for giga project properties. On average, this premium amounts to 5.7%. Yet, expats earning over $10,700 monthly show a willingness to pay a premium of 5-7.5%. This underscores their preference for features such as open spaces and park views.
OPPORTUNITIES FOR DEVELOPERS
Mohamad Itani, a Partner at Knight Frank, points out that expats earning high incomes are eager to invest more in giga project properties. This creates an opportunity for developers to provide special community features and amenities.
NEOM REMAINS A TOP CHOICE FOR EXPAT INVESTORS
If there's one thing we can take away from this, it's that NEOM remains the top choice for expat real estate investors in Saudi Arabia. It captures attention for its futuristic vision and investment opportunities.
