Saudi real estate prices fell in Q4, data shows

The Saudi real estate price index has tumbled 8.7 percent year-on-year (YoY) in Q4 2016 to 87.5 points, from 95.8 points in the same quarter last year, official data showed.

Real estate prices declined by 3.5 percent quarter-on-quarter (QoQ) in Q4, according to the General Authority for Statistics (GASTAT).

The base year for the index was determined to be 2014, according to GASTAT.

The realty index is made up of three segments; the residential sector (65 percent of the index) which includes residential plots, residential buildings, villas, apartments, and houses; the commercial sector (31 percent of the index) which covers commercial plots, commercial buildings, galleries/shops, and malls; and the agricultural sector (4 percent of the index) which is made up of the rural lands.

The residential sector fell 3.4 percent QoQ and 7.4 percent YoY in Q4.  The agricultural sector dropped 0.3 percent QoQ and 1.1 percent YoY, while the commercial sector tailed the list, plunging 4.1 percent QoQ and 12.3 percent YoY.

Cuts in public spending last year and a government plan to introduce a tax on undeveloped urban land this year have also pushed down prices, according to earlier news reports.