Constant prices of materials and equipment rentals contributed to the construction costs of Saudi Arabia, holding its position steady at a 1.1 percent yearly increase for the second consecutive month in December.
According to the General Authority for Statistics, the Construction Cost Index in the Kingdom was 101.8 points in December, compared with 101.8 points in November on a monthly basis, and matching the year-on-year increase recorded the previous month.
This continuous momentum of the construction industry in the Kingdom follows as the economies of the Gulf Cooperation Councils strive to diversify beyond hydrocarbons.
The information comes at a time when Saudi Arabia is moving forward with major development projects related to its economic diversification initiative.
Real estate consultancy Knight Frank has expected the Kingdom’s construction output value to reach $191 billion by 2029, a 29 percent surge from 2024, backed by residential development, giga-projects, and growing demand for office space.
In the most recent report, GASTAT stated, “The CCI recorded a 1.1 percent increase in December 2025, maintaining the same growth rate recorded in November 2025. This increase is mainly attributed to a 1.1 percent rise in construction costs for the residential sector and a 1.1 percent rise in construction costs for the non-residential sector, primarily costs.”
In the residential market, labor charges increased by 1.7 percent in December compared to the previous year, and renting equipment and machinery expenses increased by 1.3 percent. The energy prices registered their steep annual increase of 9.9 percent.
Basic material prices only increased by 0.2 percent, with a 1.2 percent rise in cement and concrete prices and a 0.9 percent rise in plastic and glass products.
In the non-residential market, labor expenses had risen by 1.5 percent annually, and the charges for renting equipment and machinery had escalated by 1.3 percent.
The basic material prices increased by 0.3 percent, with increases in wood and carpentry prices of 2.7 percent and plastic and glass products of 1.7 percent. Therefore, the energy prices also increased by 9.9 percent.
GASTAT reported, “CCI remained stable in December 2025 compared to November 2025, mainly due to the stability of the residential sector, where the costs of basic materials, labor, equipment and machinery rental, and energy recorded no significant changes compared to November 2025.”
Comparatively, the non-residential sector expenditure grew by 0.1 percent on a month-on-month basis, as a result of a 0.3 percent rise in labor costs, with prices of basic materials, equipment, and machinery leasing, and energy generally remaining stable.
The CCI measures the variation in the construction input prices of 51 items; the prices are gathered every month in 13 regions by field survey, which is conducted on contractors, engineering offices, and suppliers of construction materials. The base year for the index is 2023, and it is published on a monthly basis.
