Saudi Construction Cost Index Up 2.3% in July 2026

Construction costs in Saudi Arabia edged higher over the past year, with the Saudi Construction Cost Index (CCI) rising 2.3% year on year in July 2026. The increase was driven largely by higher prices for renting equipment and machinery,

The index tracks changes in the cost of building materials, labor, equipment and machinery rental, energy, and related services across the construction sector. On a monthly basis, the overall index was stable in July 2026 compared with June 2026, suggesting the yearly rise built up gradually rather than through a sudden spike.

Breaking the figures down by sector, the residential CCI rose 2.2% year on year, while the non-residential CCI increased 2.6%. In the residential segment, equipment and machinery rental costs climbed 4.2%, mainly because the cost of renting equipment with operators rose 5.7%. The pressure was sharper in the non-residential segment, where equipment and machinery rental costs jumped 5.8%, driven by a 7.3% rise in the cost of renting equipment with operators.

Why it matters

For residents and businesses across the Kingdom, construction cost trends feed into the price of new homes, offices, and commercial projects. Higher equipment rental costs can raise budgets for developers and contractors, and those pressures may eventually be reflected in property prices and rents. With building activity continuing across Riyadh, Jeddah, and other cities, the index offers a useful gauge of where cost pressures are concentrated. The steady month-on-month reading may offer some reassurance that costs are not accelerating in the short term, even as the annual comparison shows a clear upward trend.

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