Riyadh Reopens Its Land Programme With a SR1,500 per Square Metre Price Ceiling

The Royal Commission for Riyadh City opened round two of its Real Estate Balance Programme on 16 August, capping serviced residential land at SR1,500 per square metre.

The Royal Commission for Riyadh City opened the second round of its Real Estate Balance Programme on 16 August 2026, with applications running to 15 September. The mechanism is blunt: eligible buyers get serviced, planned residential plots at a maximum of SR1,500 per square metre, roughly $400 at the riyal's dollar peg. The commission intends to release between 10,000 and 40,000 plots a year across a five-year horizon. Applications run through the Tawazoun platform and are restricted to Saudi citizens who are married or over 25, own no property, and have lived in Riyadh for at least three years; allocation is explicitly not first-come, first-served.

A price ceiling used as a market instrument

What makes this different from a conventional subsidy is that the state is not paying down a mortgage; it is publishing a number. A capped, widely available alternative gives every private seller in Riyadh a visible benchmark to be measured against, and analysts quoted by Asharq Al-Awsat expect exactly that pressure on conventional asking prices. The stated purpose is to balance the market and raise homeownership among eligible beneficiaries, matching released supply to demand rather than releasing land at auction.

The gap the programme is aimed at

Glopra's Riyadh snapshot of 23 July 2026 records a city average of $1,386 per square metre of built residential space, up 4.2% over twelve months, on a gross rental yield of 5.77%. The bubble score is 93 — the highest band Glopra assigns, and the highest of any Middle Eastern market it tracks. The national Saudi picture is calmer: $1,758 per square metre, up 1.3%, price-to-income of 4.64, and a bubble score of 39 in the moderate band. The distance between a bubble score of 93 in the capital and 39 nationally is the policy problem in one line, and it is why the intervention is a Riyadh programme rather than a Saudi one.

The SR1,500 cap and the $1,386 figure are not comparable quantities — one is raw serviced land per square metre, the other is finished housing per square metre — but the relationship between them is the point. Land cost is the input the commission can control directly, and capping it is an attempt to reach the finished price from underneath.

What a foreign investor should note

Saudi Arabia's residential market opens to non-Saudi ownership from 2026, but only inside designated zones, with Mecca and Medina excluded. The Real Estate Balance Programme is aimed at eligible domestic beneficiaries, so it is not an entry route for international buyers. Its relevance to them is indirect: if the programme delivers plots at the promised rate, it changes the supply curve underneath Riyadh's asking prices during the same window in which foreign purchasers are first allowed in. Glopra records standardised transaction costs of 9% and a 5% effective rental tax rate on its non-resident case for Saudi Arabia.

The unproven part

Round one's delivery record has not been published in the coverage of this announcement, and the 10,000-to-40,000 range is wide enough that the low end and the high end imply very different effects on Riyadh pricing. A cap only disciplines the private market if the capped supply actually reaches buyers at volume. Until allocation figures appear, the programme is a stated intention with a number attached.

Sources: Asharq Al-Awsat English (17 Aug 2026) https://english.aawsat.com/business/5307908-riyadh-opens-second-real-estate-balance-program-land-price-cap; Ajel English (10 Aug 2026) https://english.ajel.sa/business/mg14krtzd; Royal Commission for Riyadh City, Tawazoun platform https://tawazoun.rcrc.gov.sa/

Market data: Riyadh · Saudi Arabia