Saudi Arabia is one of only seven international real estate markets hit by a price decline in the 12 months to June 2018.
The kingdom was among the worst-performing markets, despite Knight Frank's Global House Price Index increasing by a rate of 4.7%.
Prices in the kingdom's real estate market declined by 1.3% year-on-year to Q2 2018, although the fall slowed to 0.8% when compared to the first and second quarters of this year.
Knight Frank said prices recorded the greatest fall during a six-month period between Q4 2017 and Q2 2018, when real estate values in Saudi dropped by 1.5%.
This puts the market ahead of Ukraine and Peru – where prices fell by 4.5% and 1.6% respectively – but behind 54 other countries, including China, the US, UK, Germany, France, Malaysia, and the top performer, Malta.
Saudi Arabia was the only GCC country included in the report.
While Knight Frank's Global House Price Index increased by close to 5%, the rise was the slowest rate of growth since Q2 2016.