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
If you're considering investing in Saudi Arabia's rental market, you're probably wondering what kind of returns you can realistically expect.
In this article, we break down the current rental yields across Saudi Arabia, covering apartments, villas, townhouses, and compound units, so you can make an informed decision.
We constantly update this blog post to reflect the latest market data and trends in Saudi Arabia's real estate sector.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Saudi Arabia.
Insights
- Saudi Arabia's national gross rental yield of around 6.8% in early 2026 outperforms many Western markets, making the Kingdom attractive for income-focused property investors.
- Apartments in Saudi Arabia yield roughly 2 percentage points more than standalone villas because they rent more efficiently per square meter and attract a larger tenant pool.
- Riyadh's five-year rent freeze policy, introduced in late 2025, will likely compress future yield growth in the capital compared to Jeddah and the Eastern Province.
- The gap between gross and net yields in Saudi Arabia typically runs 1.5 to 2 percentage points, mainly due to maintenance costs, vacancy buffers, and management fees rather than annual property taxes.
- High-yield neighborhoods in Saudi Arabia, such as An Nasim and Al Suwaidi in Riyadh, can deliver gross yields 3 to 5 percentage points higher than prime areas like Hittin or Al Malqa.
- Saudi Arabia has no broad annual property ownership tax, but buyers must budget for the 5% Real Estate Transaction Tax when purchasing or selling.
- Two-bedroom units in Saudi Arabia often offer the best balance of yield and occupancy stability, appealing to both young professionals and small families.
- Vacancy rates in Saudi Arabia average around 5% nationally, but can drop below 3% in well-connected Riyadh districts where rental demand has been surging.
What are the rental yields in Saudi Arabia as of 2026?
What's the average gross rental yield in Saudi Arabia as of 2026?
As of early 2026, the estimated average gross rental yield across all common residential property types in Saudi Arabia is around 6.8%.
Most typical residential properties in Saudi Arabia fall within a gross rental yield range of roughly 5% to 8.5%, depending on property type, location, and building quality.
This average gross yield of 6.8% in Saudi Arabia compares favorably to many Western markets and sits solidly within the Middle Eastern regional norm, where yields often range from 5% to 8%.
The single most important factor currently influencing gross rental yields in Saudi Arabia is the strong rental demand in major cities like Riyadh and Jeddah, driven by urban migration, expat employment, and mega-project development, which has pushed rents up faster than in many other markets.
What's the average net rental yield in Saudi Arabia as of 2026?
As of early 2026, the estimated average net rental yield across all common residential property types in Saudi Arabia is around 5%.
The typical difference between gross and net rental yields in Saudi Arabia ranges from 1.5 to 2 percentage points, reflecting the costs landlords must absorb to maintain and manage their properties.
In Saudi Arabia specifically, maintenance and repair expenses, especially for villas where AC replacements, waterproofing, and exterior upkeep add up quickly, are the recurring cost category that most significantly reduces gross yield to net yield.
Most standard investment properties in Saudi Arabia deliver net rental yields in the range of 3.5% to 6%, with the variation depending on property type, neighborhood, and how efficiently the landlord manages costs.
By the way, you will find much more detailed rent ranges in our property pack covering the real estate market in Saudi Arabia.
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.
What yield is considered "good" in Saudi Arabia in 2026?
In Saudi Arabia, a gross rental yield of 6.5% or higher is generally considered "good" by local investors, while yields of 7.5% or above are seen as very good for the current market.
The threshold that typically separates average-performing properties from high-performing ones in Saudi Arabia is around 6.5% gross, because yields below this level often struggle to cover costs and provide meaningful income after factoring in vacancy, maintenance, and management fees.
How much do yields vary by neighborhood in Saudi Arabia as of 2026?
As of early 2026, the spread in gross rental yields between the highest-yield and lowest-yield neighborhoods in Saudi Arabia commonly ranges from 3 to 5 percentage points.
The neighborhoods that typically deliver the highest rental yields in Saudi Arabia are mid-market and working-class areas where purchase prices remain affordable but rents hold up, such as An Nasim, Al Suwaidi, Al Aziziyah, and Al Shifa in Riyadh, or Al Safa, Al Marwah, and Al Bawadi in Jeddah.
On the other hand, the neighborhoods that typically deliver the lowest rental yields in Saudi Arabia are prime, high-prestige areas where purchase prices are very elevated, such as Hittin, Al Malqa, and Al Narjis in Riyadh, or Al Hamra, Al Rawdah, and Al Zahra in Jeddah.
The main reason yields vary so much across neighborhoods in Saudi Arabia is that rent rarely rises in perfect proportion to price, so expensive prime districts command lower yields while more affordable areas offer better income relative to the purchase price.
By the way, we've written a blog article detailing what are the current best areas to invest in property in Saudi Arabia.
How much do yields vary by property type in Saudi Arabia as of 2026?
As of early 2026, gross rental yields in Saudi Arabia range from around 4.5% for standalone villas up to 8.5% for well-located apartments, with townhouses and compound units falling in between.
Apartments currently deliver the highest average gross rental yield in Saudi Arabia, typically ranging from 6.5% to 8.5%, because they rent more efficiently per square meter and attract a broader tenant pool at each rent level.
Standalone villas currently deliver the lowest average gross rental yield in Saudi Arabia, typically ranging from 4.5% to 6.5%, due to their higher purchase prices, larger maintenance burden, and a smaller pool of tenants who can afford them.
The key reason yields differ between property types in Saudi Arabia is that apartments maximize rental income relative to their purchase price, while villas carry a capital value premium that doesn't translate proportionally into higher rents.
By the way, you might want to read the following:
What's the typical vacancy rate in Saudi Arabia as of 2026?
As of early 2026, the estimated average residential vacancy rate in Saudi Arabia is around 5% for investable residential stock in major cities.
Vacancy rates across different neighborhoods in Saudi Arabia typically range from around 3% in high-demand, well-connected districts up to 8% in areas with more supply or weaker tenant appeal.
The main factor that currently drives vacancy rates up or down in Saudi Arabia is proximity to employment hubs, as neighborhoods near business districts, mega-projects, and metro corridors experience stronger tenant demand and faster lease-up times.
Saudi Arabia's vacancy rate of around 5% is relatively tight by regional standards, reflecting the strong rental demand in cities like Riyadh, where policymakers even introduced rent controls in 2025 to address surging prices.
Finally please note that you will have all the indicators you need in our property pack covering the real estate market in Saudi Arabia.
What's the rent-to-price ratio in Saudi Arabia as of 2026?
As of early 2026, the estimated average rent-to-price ratio in Saudi Arabia is around 0.57% monthly, which translates to approximately 6.8% annually when you divide annual rent by the purchase price.
A rent-to-price ratio of 0.5% monthly or higher is generally considered favorable for buy-to-let investors in Saudi Arabia, and this ratio is directly connected to gross rental yield since they measure the same relationship between rent and price from different angles.
Saudi Arabia's rent-to-price ratio of around 6.8% annually compares favorably to many European capitals where ratios often fall below 4%, though it's roughly in line with other Gulf markets like Dubai and Abu Dhabi.
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.
Which neighborhoods and micro-areas in Saudi Arabia give the best yields as of 2026?
Where are the highest-yield areas in Saudi Arabia as of 2026?
As of early 2026, the top three highest-yield areas in Saudi Arabia are mid-market neighborhoods like An Nasim and Al Suwaidi in Riyadh, Al Safa and Al Marwah in Jeddah, and Al Faisaliyah and Al Adamah in Dammam.
These high-yield neighborhoods in Saudi Arabia typically deliver gross rental yields in the range of 7% to 9%, with some well-positioned apartment buildings in areas like Al Bawadi in Jeddah or Al Aqrabiyah in Khobar reaching even higher.
The main characteristic these high-yield areas share in Saudi Arabia is that they offer solid rental demand from working professionals and families while maintaining purchase prices well below prime district levels, creating a favorable rent-to-price ratio.
You'll find a much more detailed analysis of the areas with high profitability potential in our property pack covering the real estate market in Saudi Arabia.
Where are the lowest-yield areas in Saudi Arabia as of 2026?
As of early 2026, the top three lowest-yield neighborhoods in Saudi Arabia are prime, high-prestige areas like Hittin, Al Malqa, and Al Narjis in Riyadh, and Al Hamra, Al Rawdah, and Al Zahra in Jeddah.
These low-yield neighborhoods in Saudi Arabia typically deliver gross rental yields in the range of 4% to 5.5%, because the very high purchase prices are not matched by proportionally higher rents.
The main reason yields are compressed in these areas of Saudi Arabia is that buyers pay a significant premium for prestige, lifestyle, and convenience, but tenants are not willing or able to pay rents that would justify those elevated prices.
Buying a property in a low-yield area is one of the mistakes we cover in our list of risks and pitfalls people face when buying property in Saudi Arabia.
Which areas have the lowest vacancy in Saudi Arabia as of 2026?
As of early 2026, the top three neighborhoods with the lowest residential vacancy rates in Saudi Arabia are high-demand districts like Al Olaya, Al Nakheel, and Al Muruj in Riyadh, and Al Rawdah, Al Zahra, and Al Salamah in Jeddah.
These low-vacancy neighborhoods in Saudi Arabia typically experience vacancy rates in the range of 2% to 4%, meaning units rarely stay empty for more than a few weeks between tenants.
The main demand driver that keeps vacancy low in these areas of Saudi Arabia is proximity to major employment centers, business districts, and well-developed infrastructure, which attracts a steady stream of professionals, families, and expats.
The trade-off investors typically face when targeting these low-vacancy areas in Saudi Arabia is that purchase prices are higher, which compresses rental yields even though occupancy is nearly guaranteed.
Which areas have the most renter demand in Saudi Arabia right now?
The top three neighborhoods currently experiencing the strongest renter demand in Saudi Arabia are established, well-serviced areas like Al Olaya, Al Malqa, and Qurtubah in Riyadh, along with Al Salamah, Al Rawdah, and Al Safa in Jeddah.
The type of renter profile driving most of the demand in these areas is a mix of young professionals working in business hubs, expat families relocating for employment, and mid-career Saudis seeking good schools and amenities.
Rental listings in these high-demand neighborhoods in Saudi Arabia typically get filled within one to three weeks, and well-priced, well-maintained units often receive multiple inquiries within days of listing.
If you want to optimize your cashflow, you can read our complete guide on how to buy and rent out in Saudi Arabia.
Which upcoming projects could boost rents and rental yields in Saudi Arabia as of 2026?
As of early 2026, the top three upcoming infrastructure and development projects expected to boost rents in Saudi Arabia are Diriyah in northwest Riyadh, New Murabba in north-central Riyadh, and Jeddah Central along Jeddah's waterfront.
The neighborhoods most likely to benefit from these projects include areas surrounding Diriyah, the northern Riyadh catchment near New Murabba, and central Jeddah districts close to the waterfront redevelopment, as well as areas along the expanding Riyadh Metro corridors.
Investors might realistically expect rent increases of 10% to 20% over the next few years in neighborhoods directly benefiting from these projects, though the exact timing depends on project completion and how quickly new jobs and amenities come online.
You'll find our latest property market analysis about Saudi Arabia here.
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What property type should I buy for renting in Saudi Arabia as of 2026?
Between studios and larger units in Saudi Arabia, which performs best in 2026?
As of early 2026, smaller units like studios and one-bedrooms tend to deliver higher gross rental yields in Saudi Arabia, but two-bedroom apartments often provide the best balance of yield and occupancy stability.
Studios and one-bedrooms in Saudi Arabia typically yield around 7% to 8.5% gross (roughly 52,500 to 63,750 SAR, or 14,000 to 17,000 USD, or 13,300 to 16,200 EUR annually on a 750,000 SAR property), while larger two and three-bedroom units usually yield around 6% to 7.5% gross.
The main factor that explains why smaller units outperform on yield in Saudi Arabia is that tenants pay more per square meter for compact, well-located apartments, even though their absolute rent is lower than larger units.
One scenario where larger units might be the better investment in Saudi Arabia is when targeting family renters in suburban or compound settings, where three-bedroom units attract longer-term tenants and lower turnover, offsetting the slightly lower yield.
What property types are in most demand in Saudi Arabia as of 2026?
As of early 2026, the most in-demand property type in Saudi Arabia is the two-bedroom apartment, which appeals to both young professionals and small families across Riyadh, Jeddah, and the Eastern Province.
The top three property types ranked by current tenant demand in Saudi Arabia are two-bedroom apartments, three-bedroom family units (including apartments, townhouses, and smaller villas), and compound housing in areas with strong expat populations.
The primary demographic trend driving this demand pattern in Saudi Arabia is urban concentration and household formation, as young Saudi professionals and relocating expat families seek practical, well-located housing near employment centers.
One property type that is currently underperforming in demand and likely to remain so in Saudi Arabia is the large standalone villa in less accessible locations, which faces a shrinking tenant pool due to high rents and maintenance expectations.
What unit size has the best yield per m² in Saudi Arabia as of 2026?
As of early 2026, the unit size range that delivers the best gross rental yield per square meter in Saudi Arabia is typically between 50 and 80 square meters, which covers studios and compact one-bedroom apartments.
The typical gross rental yield per square meter for this optimal unit size in Saudi Arabia ranges from around 900 to 1,200 SAR per m² annually (roughly 240 to 320 USD, or 230 to 305 EUR per m² annually).
The main reason smaller or larger units tend to have lower yield per square meter in Saudi Arabia is that very small studios can struggle with tenant appeal, while larger units spread rental income across more space without proportionally higher rents.
By the way, we also have a blog article detailing whether owning an Airbnb rental is profitable in Saudi Arabia.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Saudi Arabia versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
What costs cut my net yield in Saudi Arabia as of 2026?
What are typical property taxes and recurring local fees in Saudi Arabia as of 2026?
As of early 2026, Saudi Arabia does not impose a broad annual property ownership tax on typical residential properties, so landlords do not face the recurring property tax bills common in many Western countries.
The main recurring local fees landlords must budget for in Saudi Arabia are service charges in managed buildings or compounds, which can range from 5,000 to 20,000 SAR annually (roughly 1,330 to 5,330 USD, or 1,270 to 5,080 EUR), depending on the building and amenities.
These service charges and any minor administrative fees typically represent around 2% to 5% of gross rental income in Saudi Arabia, though this can vary significantly based on the property type and management structure.
By the way, we cover all the hidden fees and taxes in our property pack covering the real estate market in Saudi Arabia.
What insurance, maintenance, and annual repair costs should landlords budget in Saudi Arabia right now?
Annual landlord insurance in Saudi Arabia for a typical rental property usually costs between 1,500 and 4,000 SAR (roughly 400 to 1,070 USD, or 380 to 1,020 EUR), depending on property value and coverage level.
The recommended annual maintenance and repair budget in Saudi Arabia is around 1% to 2% of property value for apartments and 1.5% to 2.5% for villas, which helps cover routine upkeep and unexpected fixes.
The type of repair expense that most commonly catches landlords off guard in Saudi Arabia is air conditioning replacement or major AC repairs, which can easily run 8,000 to 15,000 SAR (roughly 2,130 to 4,000 USD, or 2,030 to 3,810 EUR) given the extreme summer heat and heavy usage.
The total combined annual cost landlords should realistically budget for insurance, maintenance, and repairs in Saudi Arabia ranges from around 12,000 to 30,000 SAR (roughly 3,200 to 8,000 USD, or 3,050 to 7,620 EUR) for a typical apartment, and higher for villas.
Which utilities do landlords typically pay, and what do they cost in Saudi Arabia right now?
In Saudi Arabia, landlords typically cover building common-area charges if applicable, while tenants usually pay for electricity (the biggest bill), internet, and often water, though specific arrangements vary by lease agreement.
If a landlord does include utilities in a furnished rental, the estimated monthly cost for landlord-paid utilities in a typical apartment in Saudi Arabia ranges from 400 to 800 SAR (roughly 105 to 215 USD, or 100 to 205 EUR), with electricity being the dominant expense due to air conditioning.
What does full-service property management cost, including leasing, in Saudi Arabia as of 2026?
As of early 2026, the estimated monthly property management fee for full-service management in Saudi Arabia typically ranges from 5% to 10% of monthly rent, which works out to roughly 1,500 to 4,000 SAR (400 to 1,070 USD, or 380 to 1,020 EUR) annually for a mid-range apartment.
The typical leasing or tenant-placement fee charged on top of ongoing management in Saudi Arabia is commonly a portion of one month's rent, often ranging from half a month to a full month's rent depending on the agency and level of service.
What's a realistic vacancy buffer in Saudi Arabia as of 2026?
As of early 2026, landlords in Saudi Arabia should set aside around 5% of annual rental income as a vacancy buffer, which accounts for the time between tenants and any unexpected gaps in occupancy.
The typical number of vacant weeks per year landlords experience in Saudi Arabia is around two to three weeks for well-located, well-priced apartments, though higher-rent or more unique properties like large villas may see longer vacancy periods of four to six weeks.
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What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Saudi Arabia, we always rely on the strongest methodology we can … and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source | Why It's Authoritative | How We Used It |
|---|---|---|
| General Authority for Statistics (GASTAT) | This is Saudi Arabia's official statistics agency and the baseline source of truth for national housing and real estate indicators. | We used it to anchor the official direction of prices and housing-related inflation. We then cross-checked private reports against it to avoid relying on just listing portals. |
| Global Property Guide | This is a well-known international property data publisher with a consistent and documented methodology for yield calculations. | We used it as the quantitative backbone for gross yields using asking rents and asking prices. We then adjusted from apartment-only data to all common residential types using Saudi market structure. |
| Cavendish Maxwell | This is a major regional real estate consultancy that publishes transparent and data-heavy market reports for Saudi Arabia. | We used it for grounded city price levels and rent growth signals in Riyadh and Jeddah. We used those price points to cross-check that yield estimates from listing-based datasets are in the right ballpark. |
| Knight Frank | Knight Frank is a global and established real estate research house widely cited across the GCC region. | We used it to contextualize demand drivers like household preferences and market direction feeding rents and yields. We used it to keep the narrative Saudi-specific rather than generic property investing advice. |
| Saudi Central Bank (SAMA) | SAMA is the central bank, and its macro reports are among the most reliable snapshots of housing's role in inflation and the economy. | We used it to frame rent and owner costs inside overall inflation and household budgets. We used it to keep assumptions realistic on what tenants can afford in early 2026. |
| Real Estate General Authority (REGA) | REGA is the regulator for real estate, and its rental index is an official transparency tool for the leasing market. | We used it to support the idea that the rental market is large, trackable, and policy-relevant. We used it to justify neighborhood-level yield discussion because district-level rent ranges exist in the index. |
| Reuters | Reuters is a top-tier wire service and reports on concrete policy actions with measurable market implications. | We used it to explain why future rent growth and therefore yields may normalize in Riyadh versus 2024-2025. We used it to anchor the early 2026 policy environment investors actually face. |
| Financial Times | FT is a highly reputable business outlet that adds useful context on supply constraints and demand pressures. | We used it to add detail on where rent pressure was strongest in parts of north Riyadh. We used it to support neighborhood-level yield dispersion since prime areas behave differently. |
| ZATCA | ZATCA is the official tax authority, so this is the definitive reference for transaction tax rules in Saudi Arabia. | We used it to separate transaction costs from annual running costs when discussing net yield. We used it to help readers budget correctly especially if they flip or refinance. |
| PwC | PwC is a top global advisory firm and is useful for plain-English interpretation of official tax changes. | We used it as a cross-check so we don't misread tax mechanics or effective dates. We used it to keep the costs that cut net yield section accurate and practical. |
| Bayut KSA | This is one of the largest listing portals in Saudi Arabia and is commonly used as a pricing pulse-check. | We used it indirectly via Global Property Guide's stated methodology as one of the underlying rent and price feeds. We also used it as a reality check on how rents vary by district and unit type. |
| GASTAT Real Estate Price Index | This is an official index built from recorded transactions and is widely referenced by banks and consultancies. | We used it to validate that residential prices have been rising as context for yields. We used it as a sanity check when translating city-level price points into a national yield estimate. |
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