New Law Allows Non-Saudis to Own Property in Saudi Arabia

Saudi Arabia has introduced a new real estate law that allows non-Saudis—including individuals, companies, and nonprofits—to own property under specific conditions. This law aims to open up the real estate market to foreign investment while maintaining some restrictions in certain areas.

Key Highlights of the New Law

1. Law Activation Timeline
   The law consists of 15 articles and will come into effect 180 days after its official publication. 
2. Geographic Restrictions
   Property ownership is only allowed in specific regions approved by the Saudi government. 
3. Makkah and Madinah Rules
   Only Muslim non-Saudis are allowed to own property in Makkah and Madinah. 
4. Foreign Entities Inclusion
   Foreign companies, funds, and institutions can purchase property across the Kingdom, including Makkah and Madinah, under certain conditions. 
5. Mandatory Registration
   All real estate ownership must be officially registered in the Real Estate Register. 
6. Transfer Fee
   Non-Saudis selling or transferring property must pay a disposal fee of up to 5% of the property’s value. 
7. Penalties for Violations
   Infractions to the law could be punished with fines as high as SAR 10 million, or even compulsory property sales. 
8. Replacement of Old Law
   This law replaces the 2000 property law, making foreign ownership easier and more transparent.

Detailed Breakdown of the Law’s Articles

Article 1: Definitions

• Law: Refers to the new Real Estate Ownership Law. 
• Authority: Refers to the Real Estate General Authority. 
• Non-Saudi: Includes any non-Saudi person, business, or nonprofit. 

Article 2: Ownership Conditions

Non-Saudis can buy property in designated zones.
The government will define:

• • Approved areas for ownership
    
  • Types of rights (e.g., full ownership, leasing)
    
  • Ownership limits
    
  • Leasing duration
    
  • Additional regulations
    

Non-Saudis legally living in Saudi Arabia can own one home outside restricted zones (except in Makkah and Madinah).

Article 3: Saudi Companies with Foreign Stakeholders

These companies can:

• • Buy land in approved areas, including Makkah and Madinah.
    
  • Own property elsewhere for business operations or employee housing.
    

Article 4: Public Companies and Investment Funds

Listed companies and licensed funds may acquire property anywhere in the Kingdom, including the holy cities, following financial market rules.

Article 5: Other Laws Still Apply

This law does not override:

• Premium Residency privileges
  
• Special GCC citizen rights
  
• Any other law offering more favorable terms
  

Article 6: No Additional Rights

Owning property does not grant any extra privileges outside what this law allows.

Article 7: Diplomatic and International Use

Embassies and international organizations may own buildings for official use, subject to treaty terms and approval from the Ministry of Foreign Affairs.

Article 8: Legal Registration

• All ownership by foreign entities must be recorded in the official register.
• Unregistered property is not legally recognized.
  

Article 9: Transfer/Disposal Fee

• A fee of up to 5% must be paid when selling or transferring real estate rights.
  

Article 10: Penalties for Violations

Violations may lead to:

• • Warnings
    
  • Fines (up to 5% of the property’s value, max SR10 million)
    
  • Sale of the property by force depending on the situation
    

Article 11: Violation Committees

• Expert committees will handle violations and fines.
  
• Decisions can be appealed within 60 days in court.
  

Article 12: Fraudulent Ownership

Providing false information can result in:

• • Heavy fines
    
  • Forced sale
    
  • Owners may get back only the lesser of:
  • The amount paid, or
  • The sale price minus penalties
    

Article 13: Implementation Guidelines

Detailed rules will be published within 180 days to clarify:

• • How non-Saudis can acquire property
    
  • Special rules for non-residents
    
  • When fees apply
    

Article 14: Previous Law Canceled

This law officially replaces the 2000 Real Estate Ownership Law.

Article 15: Enforcement Date

The law becomes enforceable 180 days after publication in the official gazette.

Conclusion

This new law represents a significant step in opening Saudi Arabia’s property market to the world. By allowing foreign ownership under regulated conditions, the Kingdom is encouraging global investment, real estate development, and economic diversification—while maintaining control over culturally and strategically sensitive regions.