JEDDAH: Saudi Arabia's largest property developer Dar Al-Arkan posted a fifth-straight decline in quarterly profit, hit by lower margins on property sales.

Dar Al-Arkan, which last achieved profit growth in the second quarter of 2012, said in a bourse filing that the lower margins were a result of "the product mix and geographical location".

The kingdom's real estate sector is characterized by very strong demand for housing — analysts say it needs to build 275,000 new homes a year for the next five years to satisfy demand.

However, a shortage of land in big cities has frustrated efforts to build new housing, while the introduction of a law to help prospective homebuyers obtain mortgages is still in the consultation phase.

Dar Al-Arkan's 17 percent profit fall to SR183.3 million ($48.9 million) in the three months to Sept. 30 was in line with an average forecast of SR184.6 million in a Reuters survey of eight analysts.

The company added that finance charges and lower income from a derivatives transaction also weighed on its results. It said that this was offset by lower operating expenses.

Saudi companies issue brief earnings statements early in the reporting period before publishing more detailed results later.