Authored by the expert who managed and guided the team behind the Saudi Arabia Property Pack
Everything you need to know before buying real estate is included in our Saudi Arabia Property Pack
What will happen in Dammam’s real estate market? Will prices go up or down? Is Dammam still a hotspot for foreign investors? How is Saudi Arabia’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with developers, real estate agents, and clients who buy properties in Dammam, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
How this content was created 🔎📝
1) Rental prices in the city will drop temporarily as new units become available
In 2023 and 2024, Dammam saw a boom in new residential developments, like the Adel District project, which will house 50,000 residents by 2025.
This construction surge is part of Saudi Arabia's Housing Program, aiming to add over 141,000 new housing units to the market. This means more rental properties are becoming available, which historically leads to a temporary dip in rental prices. When new housing projects launch, like the Naami project under the Sakani Housing program, tenants often find themselves with more choices, pushing prices down a bit.
Real estate experts say that when newer, better-equipped homes hit the market, tenants might not want to pay as much for older properties. This shift in preferences could make rental prices more competitive. The trend isn't just in Dammam; new units are also expected in Riyadh and Jeddah in 2024, suggesting a broader increase in housing supply across the Kingdom.
For potential buyers, this means you might find more attractive rental deals as the market adjusts. The influx of new units gives tenants more options, which can lead to better pricing. If you're considering buying property, keep an eye on these developments as they could impact your investment decisions.
As new rental units enter the market, the city's rental prices will experience a temporary decline. This is a pattern seen before, where increased competition among landlords leads to more favorable conditions for renters. So, if you're looking to rent, this could be a good time to explore your options.
Sources: Saudi Gulf Projects, Arab News, CBRE Saudi Arabia
2) Rental prices in Dammam will stabilize as government pushes for affordable housing
Dammam is experiencing a housing transformation thanks to government efforts.
The Saudi government's Housing Program is making waves by approving over 800 plans and issuing more than 3,000 building permits for new homes. This is part of a larger push to make housing more accessible for everyone. By 2023, the program had already surpassed its goals, helping over 96,000 families find affordable housing. This shows a strong commitment to making homes more available, which is key to keeping rental prices steady.
Looking to the future, there's a plan to build 300,000 residential units by 2025, with many of these in government-backed projects. This means more choices for renters and likely more competitive pricing, which should help stabilize rents in Dammam. The government is also teaming up with private developers to boost affordable housing options, supporting this trend even further.
These initiatives are not just about numbers; they are reshaping the housing landscape in Dammam. With more homes being built, renters can expect a wider range of options, which could lead to better deals and more stable rental prices. The collaboration between the government and private developers is crucial in this effort, ensuring that the supply of affordable housing continues to grow.
As these projects come to fruition, the rental market in Dammam is likely to see a shift. More available housing means renters won't have to compete as fiercely for a place to live, which can help keep prices in check. This is a promising development for anyone looking to rent in the area.
Sources: Annual Report - Housing Program, Argaam, Knight Frank
We have made this infographic to give you a quick and clear snapshot of the property market in Saudi Arabia. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Demand for modern, tech-enabled housing will grow as the city's younger population increases
The city's younger demographic is a significant driver for modern, tech-enabled housing solutions.
In Saudi Arabia, 36.7% of the population is aged 15-34, and many of these young individuals call Dammam home. This age group is known for its love of modern living environments, making them prime candidates for tech-savvy homes.
Studies highlight that younger people are quick to embrace smart home technologies. For instance, 70% of younger adults show the highest adoption rates and satisfaction levels with smart home tech. As these young folks start their own households, expect a surge in demand for homes equipped with the latest tech.
Dammam is on the brink of becoming a hub for tech startups and innovation, drawing in tech-savvy young professionals. These individuals often seek out areas with advanced infrastructure, which in turn fuels the demand for modern housing solutions.
With the city's younger crowd leading the charge, the housing market is set to evolve. Expect a shift towards homes that cater to tech enthusiasts, offering features that align with their digital lifestyles.
As Dammam continues to grow, the influx of young professionals will likely shape the future of housing, making it more tech-centric and modern.
Sources: Arab Development Portal, Bio Conferences, DAMAC Properties
4) More Asian buyers will invest in Dammam due to new business opportunities
Dammam is becoming a hotspot for Asian investors thanks to fresh business opportunities.
Saudi Arabia is aiming for $100 billion in Foreign Direct Investment (FDI) by 2030, with a big chunk expected from Asia. The country has updated its investment laws to make it easier for Asian countries to invest, which is a major draw for foreign buyers.
Asian expatriates are flocking to Saudi Arabia, making up 41.6% of the population as of November 2023. The largest groups are from Bangladesh and India, showing a growing interest in the Saudi market and hinting at more business activities and investments from Asia.
The Saudi government is actively pursuing more FDI from Asia by forming new business partnerships and trade agreements. They're focusing on sectors like energy, construction, and finance, which are key areas for Asian investors. This shows a strong effort to build solid business ties with Asian countries.
Dammam's strategic location and modern infrastructure, like King Fahd International Airport and King Abdulaziz Port, make it a prime spot for international businesses. This enhances its appeal for Asian companies looking to expand.
With these developments, it's clear that Dammam is set to see a rise in foreign buyers from Asia, drawn by the new business opportunities and the city's strategic advantages.
5) European buyers will show more interest in the city’s real estate market for investment opportunities
Dammam is catching the eye of European investors looking for real estate opportunities.
The city is becoming a hub for European expatriates, especially those in industries like oil, gas, and technology. This creates a familiar and appealing environment for potential investors. The presence of these industries not only boosts the local economy but also provides a sense of community for newcomers.
The Saudi government is making it easier for foreign investors to dive in. With regulatory reforms and tax incentives, the process is now more straightforward and attractive. These changes are part of a broader strategy to open up the market and invite more international players.
Dammam's economy is on the rise, with positive growth forecasts and a booming logistics sector. This means there's a strong demand for both housing and commercial spaces. Investors are drawn to the potential for high rental yields and capital appreciation, making it a promising destination.
With the expected population increase, the city is gearing up for more development. This growth is not just in numbers but also in infrastructure, which supports the expanding industries and enhances the quality of life for residents.
All these factors combined make Dammam a hotspot for European investors seeking lucrative opportunities in a dynamic market.
Sources: Cities ABC, Setup in Saudi, Global Business Outlook
Get to know the market before you buy a property in Dammam
Better information leads to better decisions. Get all the data you need before investing a large amount of money. Download our guide.
6) Dammam’s property prices will keep rising because of ongoing economic growth
Dammam's residential property prices have been on the rise, thanks to the city's booming economy.
With Saudi Arabia's GDP steadily climbing, more people are eager to buy homes, which naturally pushes property prices up. This economic growth is like a magnet, drawing in potential homeowners and investors alike.
Foreign direct investment in Dammam's real estate has skyrocketed, soaring from 422.697 SAR million in 2022 to 2,509.512 SAR million in 2023. This influx of money is a clear sign that investors see a golden opportunity in the city's property market.
Government initiatives, especially Vision 2030, are reshaping the landscape. This ambitious plan aims to diversify the economy and promote urban development, leading to major investments in real estate and infrastructure. These changes are making Dammam a hot spot for both residents and investors.
As the city becomes more appealing, property prices are expected to keep climbing. The combination of economic growth, foreign investment, and government projects is creating a perfect storm for the real estate market.
For anyone considering buying property in Dammam, now might be the time to act. The city's transformation is well underway, and the potential for future gains is significant.
Sources: Global Flow Control, Design Space, Wikipedia
7) Property prices in the city will drop temporarily as new housing projects increase supply
Dammam is experiencing a boom in new housing projects, with approvals skyrocketing in 2023 and 2024.
One standout project is the Adel District, which aims to house 50,000 residents by 2025. This is just a piece of the larger puzzle of increased construction activity in the city.
The Saudi government's Housing Program, featuring initiatives like Sharakat, has been a game-changer, resulting in over 141,000 new housing units being built. This influx of new homes is expected to make properties more available, which could mean lower rental yields and property prices.
Real estate experts are keeping a close eye on this trend. They predict that with more properties on the market, renters might see more competitive pricing, and property prices could temporarily dip.
Looking at other cities like Dubai and Abu Dhabi, where a similar increase in supply led to lower rental yields, Dammam might follow the same path.
Source: Arab News
8) Rental yields in Dammam will rise as rental demand exceeds supply
Rental yields in Dammam are on the rise as demand for rental properties outpaces supply.
With Dammam's population steadily growing, projected to hit 1,376,000 by 2025, more people are searching for homes. This surge in residents naturally boosts the demand for rentals. The city's appeal isn't just about numbers; it's about the lifestyle and opportunities it offers.
Job opportunities are another magnet. In 2024, Saudi Arabia saw a job growth rate of 7.7%, drawing job seekers to Dammam. This influx means more people need places to live, but new housing isn't keeping up. Projects like the Adel District are in the works, but they're not enough to meet the growing demand, pushing rental yields higher.
Dammam's urbanization and infrastructure projects are transforming the city into a hotspot for both residents and businesses. Government initiatives like the Housing Program and Sharakat aim to build new homes, yet rental demand still outstrips supply, keeping rental prices on the rise.
Many residents prefer renting over buying, thanks to Dammam's diverse real estate options, from luxury apartments to affordable housing. This trend, along with high occupancy rates in existing rentals, indicates that the demand for rental properties will stay strong.
Sources: Macrotrends, Zawya, Wikipedia
We made this infographic to show you how property prices in Saudi Arabia compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
9) Rental yields in Dammam will stabilize due to new regulations promoting fair rental practices
Dammam's rental market is on the rise, thanks to a balanced supply and demand.
With the city's population growing from 1,329,000 in 2023 to 1,353,000 in 2024, this balance is helping to keep rental yields stable. The Saudi government's new rental regulations, introduced in February 2023, are a big part of this stability. These rules aim to make the rental market more transparent and fair, which is crucial for keeping rental yields steady.
One standout feature of these regulations is the flexibility in lease contract durations. Now, leases can last up to 25 years, or even 50 years for investment projects on government land. This change is expected to attract more investors and offer tenants more stable, long-term housing options, making the rental market more predictable.
While we don't have specific data on tenant satisfaction or resolved rental disputes, the balanced supply and demand suggest that tenants are generally happy with the current rental practices. The new regulations are likely to further reduce disputes by ensuring fair and transparent rental agreements.
These changes are not just about numbers; they reflect a shift towards a more investor-friendly environment. By offering longer lease terms, the government is encouraging investment in the real estate sector, which could lead to more development and better housing options for everyone.
As these regulations take hold, we can expect Dammam's rental yields to stabilize, providing a more secure environment for both investors and tenants. This is a promising development for anyone considering buying property in the area.
Sources: Invest Gate, Zawya
10) Rental yields in the city will rise as more expats opt to rent instead of buy
Dammam's population is on the rise, with expectations to jump from 1.9 million in 2019 to 3.05 million by 2040.
This growth means more people are looking for places to live, and rental properties are in high demand. The city is a magnet for expatriates, especially those in the oil and gas industry, who often prefer renting over buying due to the temporary nature of their work.
Every day, Saudi Arabia welcomes 79 new expatriates, many of whom head to Dammam for job opportunities. These newcomers are more likely to rent, adding to the city's rental market buzz.
Buying property in Dammam isn't easy for everyone. Rising property prices make it tough for many expatriates to purchase homes, especially when compared to the high costs in cities like Riyadh and Jeddah. This financial hurdle nudges more people towards renting.
Government initiatives, like the Quality of Life Program, also play a role. These policies often make renting a more attractive option for those who are in the country temporarily, further boosting the rental market.
Sources: Global Media Insight, Zawya, Macrotrends
11) Demand for single-family homes in Dammam will drop as more people choose apartment living
Dammam is seeing a big shift towards apartment living as more people choose this over single-family homes.
One reason for this change is the booming Saudi Arabia Condominiums and Apartments Market, which is expected to grow significantly in the coming years. This growth is evident in Dammam, where there's been a 38% jump in apartment transactions and a notable increase in their total value.
Urbanization is another driving force. With more people moving to cities, Dammam's metro area population is on the rise, reflecting a broader trend towards urban living. This shift is backed by surveys showing that people prefer apartments due to competitive rental prices and increasing household costs.
Demographics are changing too. Young professionals and smaller households are leaning towards apartments for their convenience and affordability. The job market is strong, with a 7.7% growth rate, which keeps the demand for rentals steady and supports Dammam's rental yields.
Government initiatives like the Saudi Housing Program are also making apartments more appealing by promoting high-density living. Infrastructure development in Dammam is attracting more residents and businesses, which boosts the need for rental properties and apartments.
Media coverage is highlighting the perks of apartment living, such as low maintenance and shared facilities, making them even more attractive. Investments are increasingly directed towards multi-family units with modern amenities, showing a clear interest in this housing type.
Sources: Macrotrends, Mordor Intelligence, Trading Economics
Buying real estate in Dammamcan be risky
An increasing number of foreign investors are showing interest. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
12) Property values in Dammam's Al Manar will rise with the addition of new public parks
New public parks can significantly boost property values.
Take Riyadh, for instance. When King Salman Park was developed, nearby properties became hot commodities. This isn't just a Riyadh thing; it's a trend seen in cities worldwide. People love living near green spaces, and it shows in property prices.
Urban planning experts often talk about how parks make communities more attractive. A report by CBRE highlights that in Dammam, mixed-use developments with parks are gaining popularity. These areas offer convenience and a strong sense of community, which residents really appreciate.
Properties close to green spaces tend to go up in value. After the pandemic, outdoor spaces like terraces and gardens became must-haves in Saudi cities. This change is especially noticeable among millennials, who are all about eco-friendly living.
In Dammam's Al Manar area, the introduction of new public parks is expected to follow this pattern. Property values are likely to rise as these parks enhance the area's appeal. It's a win-win for both the community and potential buyers.
So, if you're thinking about buying property in the country, keep an eye on areas with new parks. They not only offer a better quality of life but also promise a good return on investment.
Sources: CBRE Saudi Arabia Real Estate Market Review Q4 2023, Knight Frank, S&P Global
13) Property values in Al Shati will drop as new coastal rules restrict construction
New coastal regulations are likely to cause a decline in property values in the Al Shati neighborhood.
In 2023, Dammam saw a 12% drop in residential transactions and a 23% decrease in their total value. This means fewer people are buying homes, which often forces sellers to lower prices. Across Saudi Arabia, higher interest rates and prices have made potential buyers hesitant, further impacting the market.
Looking at places like California, where similar regulations exist, we see mixed results. While these rules can sometimes boost property values by creating attractive amenities, they can also impose costs on owners. If the restrictions are too tight, property values can decline as demand decreases.
In Dammam, apartment prices fell by 0.5% and villa rates by 2.5% over the past year, showing a shift in demand away from regulated areas. This trend could further impact Al Shati, especially if fewer building permits are issued, leading to less construction activity.
Sources: Construction Week Online, Bren School of Environmental Science & Management, Zawya
14) Property prices in Al Rakah will rise as new schools open nearby
The Al Rakah district in Dammam is buzzing with change as new educational institutions, like the Imam Abdulrahman Bin Faisal University, expand.
With the university's growth, student enrollment is booming, which means more people are looking for places to live. This surge in demand is a key factor that pushes property prices up. It's a pattern seen before; when educational facilities pop up, property values tend to follow suit.
Take Riyadh's Diplomatic Quarter, for instance. It saw a property price hike thanks to luxury housing projects and its appeal to international residents. Similarly, Jeddah's Al Hamra District experienced a rise due to limited housing stock and growing demand for prime properties. These examples show how educational and housing developments go hand in hand.
When educational complexes are built, they often bring along infrastructure improvements. Think better transportation links and public amenities. These upgrades make areas more attractive, which in turn drives up property prices. Al Rakah is expected to see similar enhancements alongside its educational growth.
Real estate experts are optimistic about areas with expanding educational institutions. New mortgage laws and financial products are making it easier for citizens to buy homes, which is boosting demand in the housing market, including in Al Rakah.
So, if you're considering buying property in Al Rakah, keep an eye on these developments. The district is on the rise, and with the educational boom, property prices are likely to climb.
Sources: Edu.com.sa, Times Higher Education, Expatica
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Saudi Arabia. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
15) Property values in Dammam's Al Shati will drop as new environmental rules limit beachfront development
New environmental regulations are now in place in Dammam's Al Shati area, limiting beachfront development.
These rules echo those in places like New Jersey and California, where property values have dropped due to similar restrictions. When you can't build as much, the available land supply shrinks, which can hurt property values.
Reports indicate that buyer interest often wanes when development is restricted. In today's market, many buyers are concerned about climate change and want properties that can handle environmental challenges. Areas with these new restrictions might not fit the bill, leading to less demand and lower property values.
Saudi Arabia's Vision 2030 is pushing for more sustainable living, and eco-friendly buildings are becoming a priority. Properties in Al Shati that face development limits might not match these new preferences, which could further decrease interest and property values.
Looking at other regions, strict environmental standards have historically slowed down development, often resulting in lower property values over time. This trend could very well play out in Al Shati as well.
Sources: HUD User, AZ Big Media
16) Property prices in Al Khalidiyah will rise as new cultural attractions are developed
The Al Khalidiyah district is buzzing with new cultural investments, making it a hot spot for potential property buyers.
They're not just sprucing up old buildings; local arts and crafts are getting a big push, and cultural festivals are popping up. This makes the area more appealing to both locals and tourists, which usually means property prices will climb.
We've seen this happen in other parts of Jeddah, like the Jeddah Central project. This massive development, with its cultural venues and new homes, has already boosted property demand. When areas get more attractive because of cultural attractions, people naturally want to live there, driving up property prices.
Al Khalidiyah is also getting a lot of media attention as a new cultural hub. Known for its beautiful mosques and lively souks, it offers a unique shopping experience. This kind of buzz can make the area more desirable, leading to increased property values.
Real estate market reports show strong demand in Jeddah, including Al Khalidiyah. For instance, villa sales in Riyadh have risen significantly, and this trend is expected to continue. As more modern and high-quality homes are built, the demand and prices are likely to go up.
With all these developments, Al Khalidiyah is set to become a prime location for property investment.
Sources: Kane Bridge News, Evendo, Oxford Business Group
17) Rental prices in the city will rise as short-term rental demand grows
Dammam's population is on the rise, growing from 1,329,000 in 2023 to 1,353,000 in 2024.
This growth means more people are looking for places to stay, which could lead to increased demand for short-term rentals as visitors flock to the city. With Saudi Arabia's job market booming at a 7.7% growth rate in 2024, Dammam's rental market is becoming more stable and attractive.
Business travelers are a big part of this story, often needing short-term accommodations, which boosts the demand for rentals. The city's economic stability is a magnet for expatriates and temporary workers, especially with ongoing infrastructure projects.
These workers need temporary housing, which means more short-term rental options are necessary. As Dammam continues to develop, the influx of people for work and business will keep the rental market buzzing.
So, if you're considering buying property here, it's worth noting that the city's rental prices are likely to rise as demand for short-term rentals increases.
Sources: Moodie Davitt Report, Statista, Knight Frank
Don't lose money on your property in Dammam
100% of people who have lost money there have spent less than 1 hour researching the market. We have reviewed everything there is to know. Grab our guide now.
18) Property prices in the city will stabilize as government policies balance supply and demand
The city's property market is buzzing with new developments, thanks to a surge in construction projects.
Take the Adel District Project, for instance, which is set to expand over 5.6 million square meters by 2025, welcoming 50,000 new residents. This massive development is expected to boost the housing supply, potentially leading to a slight dip in rental prices and helping to stabilize property prices.
The Saudi government is also stepping up with initiatives like the Housing Program and Vision 2030. They're not just building over 141,000 new housing units but also pumping significant funds into housing development. By streamlining licensing processes and encouraging land development through the White Land Program, the government aims to balance supply and demand in the real estate market.
Looking back, government policies have a track record of stabilizing the real estate market. Vision 2030, for example, has been a game-changer in promoting sustainable urban development. The Etmam program is also making waves by speeding up building approvals for developers, which further boosts the supply of residential land.
These efforts are not just about numbers; they're about creating a balanced and sustainable property market. With these initiatives, the city is on a path to a more stable real estate environment, where supply meets demand more effectively.
As these projects unfold, potential buyers can expect a more predictable market, where property prices are less likely to skyrocket unexpectedly.
Sources: AGBI, Design Space
19) Investment in Dammam's residential real estate will grow due to new tax incentives
In 2023, residential transactions in Dammam's real estate market dropped by 12%, mirroring some economic ups and downs.
Despite this dip, there's a silver lining with new tax incentives set to boost investment in Dammam's housing sector. These incentives are part of a broader strategy to attract more foreign direct investment (FDI) into Saudi Arabia's real estate, which saw a jump from 422.697 SAR million in 2022 to 2,509.512 SAR million in 2023. While we don't have exact numbers for Dammam, this national surge hints at a promising future for the city.
The Saudi government is pulling out all the stops to lure investors, tweaking visa policies and regulations to make the environment more inviting. These changes, coupled with the upcoming tax incentives, are setting the stage for a real estate boom in Dammam.
One of the standout projects in Dammam is the Adel District, which spans 5.6 million square meters and is designed to house 50,000 people. This massive development is expected to be a magnet for investors, potentially driving up property prices as demand grows.
With these developments, Dammam's real estate market is becoming increasingly attractive. The combination of government reforms, significant projects like the Adel District, and the anticipated rise in property values makes it a hot spot for potential buyers.
As these factors come into play, the new tax incentives are likely to be a game-changer, encouraging more investment and possibly reversing the current trend of declining transactions.
Sources: Construction Week Online, S&P Global
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.