Saudi Construction Costs Show Steady Annual Increase in December 2025

Saudi Arabia Construction Sector

Saudi Arabia: Construction costs in Saudi Arabia continued to rise at a steady pace in December 2025, with the Construction Cost Index increasing 1.1% year on year for the second consecutive month, supported by stable prices for materials and equipment rentals. The index stood at 101.8 points in December, unchanged from November monthly, according to data released by General Authority for Statistics. The stable trend comes as the Kingdom advances large-scale development activity linked to its economic diversification efforts.

According to GASTAT, the annual increase was driven by a 1.1% rise in construction costs across both residential and non-residential sectors. In the residential segment, labor costs rose 1.7% year on year, equipment and machinery rental costs increased 1.3%, and energy prices climbed 9.9%, while basic material prices edged up 0.2%. In the non-residential sector, labor costs increased 1.5% and basic material prices rose 0.3%, alongside a 9.9% rise in energy prices. Separately, Knight Frank has projected Saudi Arabia construction output value to reach US$ 191 billion by 2029, supported by residential development, giga projects, and rising demand for office space.

Source: General Authority for Statistics