Saudi Arabia Unveils Detailed Rules for Foreign Property Ownership

RIYADH, SAUDI ARABIA – Saudi Arabia has introduced a comprehensive regulatory framework governing property ownership by non-Saudis, establishing detailed requirements for foreign individuals, companies and non-profit organisations while creating a unified digital platform for all ownership transactions.

The executive regulations for the Foreign Ownership of Real Estate Law introduce standardised procedures for acquiring property and real estate rights across the Kingdom, strengthen disclosure requirements, implement electronic transaction mechanisms, and establish penalties of up to USD2.67 million (SAR10 million) for violations.

The regulations complement the recently approved geographical zones where non-Saudis are permitted to own property and are designed to enhance transparency, strengthen market governance and support investment.

New Requirements for Foreign Individuals

Before purchasing property or acquiring any real estate right in Saudi Arabia, non-resident foreign individuals must obtain a Ministry of Interior-approved digital identity, open a Saudi bank account in their own name, and register a Saudi mobile number linked to their digital identity.

The measures are intended to verify buyers' identities and ensure all financial and legal transactions are linked to officially authenticated records.

Read more: Saudi Arabia Activates Law Permitting Foreign Ownership of Real Estate

New Obligations for Foreign Companies

Foreign companies seeking to own real estate in the Kingdom will be required to register with the Ministry of Investment, fully disclose their direct and indirect beneficial owners, appoint a legal representative holding an approved Saudi identity, and open a company bank account in Saudi Arabia.

Once these requirements have been completed, the Ministry of Investment will issue a registration number.

Companies must also notify the ministry within 15 days if ownership of 5% or more changes, whether through a single transaction or multiple transactions, or if governance arrangements in the country of incorporation allow another party to influence company decisions or reduce its independence.

Rules for Foreign Non-Profit Organisations

Foreign non-profit organisations must register with the National Center for Non-Profit Sector Development.

They will also be required to disclose individuals exercising direct or indirect control, appoint an authorised representative holding an approved Saudi identity, maintain a Saudi bank account, and notify authorities within 15 days of significant structural changes or changes affecting decision-making control.

Unified Electronic Platform

One of the key elements of the regulations is the establishment of a unified electronic platform by the Real Estate General Authority (REGA).

Linked directly to the national Real Estate Registry, the portal will serve as the exclusive platform for submitting applications to purchase property, acquire real estate rights, or complete transactions involving non-Saudi individuals, foreign companies and Saudi companies with foreign shareholders.

All financial transactions relating to property purchases or disposals must be completed through electronic payment systems approved under Saudi Central Bank regulations before title deeds are transferred through the Real Estate Registry.

Family Ownership Rules

The regulations also introduce restrictions on multiple residential purchases within a single foreign family.

A foreign spouse and non-Saudi children will be treated as dependants when acquiring a residential property and cannot separately own another residence unless the marriage ends or a son or daughter reaches the age of 25.

Saudi Companies with Foreign Shareholders

Saudi companies that are not listed on the stock exchange but have foreign shareholders may own property outside the designated foreign ownership zones—excluding Makkah and Madinah—after obtaining approval from the Ministry of Investment, provided the property is used for business operations or employee housing.

Within the approved ownership zones, including Makkah and Madinah, these companies may acquire property without ministry approval, subject to the conditions set out in the law.

Transaction Fees and Exemptions

The regulations introduce a 2% fee on transactions involving real estate rights acquired by non-Saudis in Riyadh, Jeddah, Makkah and Madinah.

However, ten categories of transactions are exempt from the fee, including inheritance divisions, final court judgments, expropriation for public use, donations to endowments and government entities, returning property to its previous owner within 180 days under specified conditions, division of jointly owned property without increasing ownership shares, transactions involving diplomatic missions and international organisations under reciprocity arrangements, transfers of property to wholly owned companies or investment funds, and sales of real estate units developed on foreign-owned land, subject to project completion and sale deadlines.

Digital Notifications

Legal notifications will be considered valid if delivered through communication channels registered on the electronic portal or via text messages sent to officially registered Saudi mobile numbers.

REGA will also publish a detailed procedural guide explaining how the regulations will be implemented.

Inspections and Enforcement

The regulations authorise REGA-appointed inspectors to investigate and document violations.

Before penalties are imposed, violators must be given between 10 and 180 days to rectify their status, depending on the nature of the violation.

Penalties

The regulations establish a graduated penalty system.

Foreign buyers who submit false or misleading information to obtain property ownership rights may be fined up to 5% of the property's value, with a maximum penalty of USD2.67 million (SAR10 million).

Other violations, including providing false information to obtain Ministry of Investment approval, obstructing inspectors, failing to rectify violations, or failing to report required ownership changes, carry penalties ranging from warnings to fines between 0.1% and 3% of the property's value. Maximum fines can reach USD1.07 million (SAR4 million) in some cases and up to USD533,000 (SAR2 million) for repeated reporting violations.