The Saudi construction sector recorded the highest activity ever in June

The Saudi construction sector index rose to 56.3 points in June, recording an all-time high, driven by the start of new projects and increased demand, according to a new report.

According to a report "Al Rajhi Capital" For the Saudi construction sector, prepared by the Foundation "Standard & Poor’s Global"The index rose from 51.2 points in May, recording the strongest growth since the start of the survey in January, and continuing to rise for the second month in a row.

An index reading above 50 points indicates an expansion of activity, while a reading below 50 indicates a contraction. Although May remained the strongest month in terms of value, June ranked second, which confirms the continued momentum of the construction sector in the Kingdom.

Activity is based on The construction sector in the Kingdom indicates continued government spending on housing, infrastructure and tourism projects within the framework of Vision 2030.

Residential and commercial sector activity

The residential construction sector recorded the highest level of activity at 58.4 points, followed by the non-residential construction sector at 55 points, then the infrastructure sector at 53.6 points.

The survey participants attributed the strong performance for the month of June to the launch of new projects, improved regional stability, And business operations return to normal. These factors have contributed to raising the level of activity in all major construction sectors.

The residential construction sector remained the strongest performer, supported by improved investor confidence and continued government support for housing projects.

Commercial and industrial projects also witnessed an acceleration in the pace of growth, while infrastructure activity returned to expansion with the progress of utility and transportation projects within the framework of Vision 2030 investment spending.

New orders rise despite cost pressure

The survey also indicated an optimistic outlook on the projects However, pressures remained Construction costsare high, as purchases of production inputs expanded for the first time in 4 months, while supplier delivery times improved to their best level since February, although shipping routes continued to change.

However, companies reported higher Prices of steel, aluminium, cement and electrical equipment, which has narrowed developers’ profit margins.

Saudi Construction Sector Outlook

Nearly half of the companies surveyed, or 49%, expect an increase in activity over the next 12 months, while only 8% expect a decrease.

On the other hand, the Saudi Contractors Authority expects to award 23 projects during July 2026, concentrated More than 60% of them are in the building and construction sector.

This survey comes in light of the continued strength of construction projects in the Kingdom, as the Saudi Contractors Authority announced the award of 25 projects worth more than 29.5 billion riyals during the month of June, which is the highest monthly total this year.

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