Saudi Construction Costs Rise 2.3% in August 2026

Construction costs in Saudi Arabia climbed 2.3% year-on-year in August 2026, The index reached 104.0 points last month, up from 101.8 points recorded in August 2025, reflecting steady pressure on building expenses across the Kingdom.

On a monthly basis, costs edged up 0.1% compared with July 2026, pointing to a slower pace of growth in the short term even as annual figures remained elevated.

The increase was felt across both housing and commercial building segments. Residential construction costs rose 2.1% year-on-year, while non-residential construction costs increased at a faster rate of 2.6%.

Where costs rose most

For residential projects, the biggest jumps came from equipment and machinery rental with an operator, up 5.6%, and labour costs, which rose 5.1%. Equipment and machinery rental increased 4.1%, energy 3.0%, metal products 2.0%, and basic materials 1.8%.

In the non-residential category, equipment and machinery rental with an operator surged 7.2%, while equipment and machinery rental alone rose 5.8%. Energy costs increased 3.0%, labour 2.0%, and basic materials 1.8%.

The figures matter for residents, homeowners, and businesses planning building or renovation work, as rising input costs — particularly for skilled labour and machinery — can influence the final price of new housing and commercial developments. The index is published monthly by the General Authority for Statistics as a key measure of the sector's health.

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