(Bloomberg) --

The more than 300 apartments in Almajdiah Residence’s new Riyadh complex sold in just a month for cash, without the company even having to advertise.

This is Saudi Arabia, the world’s biggest exporter of oil, so it’s no surprise the property market is red-hot as income from a spike in energy prices flows through the economy. 

But Almajdiah’s chief executive officer, Abdulsalam Almajed says the scramble for the 1-million-riyal ($266,400) homes reflects something else, too: the social and economic shift that’s reshaping the kingdom, accelerated by the crown prince’s overhaul program.

“There’s a change in mindset,” said Almajed, who heads family-owned developer, as some Saudis embrace the more open style of living his firm caters to. “Today there’s beautiful creativity in Saudi designs.”

While de facto ruler Mohammed bin Salman has centralized power and increased political repression since being elevated by his father, King Salman, in 2015, he’s also ended or relaxed restrictions on entertainment and how men and women can mix, and is trying to curb a reliance on oil.

Ten years ago, many property owners wouldn’t even rent to women, who needed approval of a male guardian for many life decisions. Today, women are entering the labor market in greater numbers, and 30% of Almajdiah’s buyers are female, acquiring investment properties or a home of their own.

They’re helping lift an economy transformed by energy markets. As much of the world is fretting about spiraling inflation fueled by Russia’s war in Ukraine and potential recessions, oil averaging more than $100 a barrel this year means Saudi Arabia’s economy is the fastest growing in the Group of 20.

Gross domestic product expanded 11.8% in the second quarter, when the non-oil economy grew 5.4% and is now larger than at the end of 2019, before the pandemic struck. 

State energy company Saudi Aramco has reported the biggest quarterly adjusted profit of any listed company globally. Billions of dollars are flowing into Saudi coffers and raising state investments, boosting sentiment in a private sector reliant on government contracts. 

Capital spending jumped an annual 64% in April to June, as the kingdom embarks on a building spree including malls and parks as well as grandiose plans for a new city built from scratch and a luxury tourism development on the Red Sea. Overall spending was 16% higher, even though this year’s initial budget forecast it would fall. 

Summers typically send Saudi elites off to cooler climes in Europe, but Riyadh’s newest high-end restaurants are packed. At Coya, a Latin American chain, the most popular dinner seatings -- 8:30 to 9 p.m. --- are fully booked a month ahead. 

Combined cash withdrawals and points of sales transactions, an indicator of consumer activity, have bounced back, increasing an annual 9% in June after a record high in March. Inflation last month was 2.7%, about a third of the rate in the US or eurozone.

The Finance Ministry’s trying to break the habit of oil-tracking splurges and cutbacks, flowing stimulus through sovereign funds and into longterm projects like electric-vehicle manufacturing and tourism.

The economy is expected to expand 7.6% this year but growth could fall back to 2.5% by 2024, according to a Bloomberg survey of economists. Crude is now around $90 a barrel as global fears over economic downturns and the potential for more supply from Iran if its nuclear deal is resurrected continue to hang over the market.

“If there was another collapse in oil prices, there will again be slowing down in activity,” said Monica Malik, chief economist at Abu Dhabi Commercial Bank. “But a number of positive factors are coming together at this point.”

Almajdiah caters to affluent professionals who want open-plan homes with abundant natural light. Many Saudis previously preferred houses with high walls and tiny windows to preserve privacy. But the social opening, along with smaller families and tighter budgets, is changing that.

The developer’s newest complex is built around shared courtyards and features cafes, gyms and a nursery. 

The style echoes high-end housing in Dubai, the regional hub Prince Mohammed wants to compete with, announcing plans to double Riyadh’s population and attract millions of expatriates. 

That’s key to Almajed’s optimism, which has helped propel the real estate developer he heads to start planning for an initial public offering. The more people, the more apartments they’ll need, he said.

(Adds company IPO plan in last paragraph)

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