Complex Made Simple

Rents in Saudi Arabia rise 16.6 per cent in 4 years

From the beginning of the current year until September, rents picked up 4.6 per cent

House rents in Saudi Arabia surged by 16.6 per cent over the past four years (from September 2011 to September 2015).

The benchmark index measuring rents jumped to 184.2 points in September this year from 158 points in the same month in 2011, according to data compiled by Al Eqtisadiah.

From the beginning of the current year until September, rents picked up 4.6 per cent to 184.2 points from 176.1 points in December of 2014.

The rise in rents since the beginning of this year is higher than inflation, which only edged up by 1.8 per cent to stand at 133.9 points in September compared with 131.5 points in December of 2014.

The Central Department of Statistics and Information gauges inflation by monitoring the prices of 476 commodities and services in 16 cities across the kingdom.

According to the data, a Saudi family spends roughly 12.5 per cent or SAR2,220 of its monthly income on rents. Earlier analysis reveals that each member of a Saudi household spends SAR333 a month or approximately SAR4,000 a year on rents.

In 2014, Saudis spent a total of SAR81 billion on rents.

Recently, the Saudi cabinet referred a draft law introducing taxed on undeveloped lands inside urban areas in a bid to resolve the housing crisis in the country.

(SAR1 = AED0.98, at the time of publishing)