Latest news with #nonSaudis
Gulf Business
5 days ago
- Business
- Gulf Business
Foreigners owning property in Saudi: The rules you need to know
Image: Getty Images/ For illustrative purposes Saudi Arabia has officially published the full text of a new law regulating real estate ownership by non-Saudis, following cabinet approval earlier this month. The legislation, released in the Umm Al Qura official gazette on Friday, July 25, will come into effect 180 days from publication and marks a significant shift in the country's real estate and investment policy, Read- The new law grants non-Saudis, including individuals, corporations, and non-profit organisations, the right to own property or obtain other real rights within designated zones to be defined by the Council of Ministers. These rights include usufruct (beneficial use), leaseholds, and other interests, but will be subject to geographic and usage-based restrictions. Importantly, all legal property rights held by non-Saudis prior to the law's enactment will remain protected. Key restrictions remain Despite the liberalization, the law maintains a firm stance on property ownership in the holy cities. Ownership remains prohibited in Makkah and Madinah, except under specific conditions for individual Muslim owners. Foreign individuals legally residing in the country may own a single residential property outside restricted zones for personal housing purposes. A central provision mandates that the Council of Ministers, based on recommendations from the Real Estate General Authority and with approval from the Council of Economic and Development Affairs, will designate the permissible zones for foreign ownership. These zones will include limits on ownership percentages and the duration of usufruct rights. Foreign-owned non-listed companies, licensed investment funds, and special-purpose entities may acquire real estate throughout the Kingdom, including in Makkah and Madinah, provided the ownership is for operational needs or employee housing. Listed companies and investment vehicles are permitted to own property in line with Saudi financial regulations. Diplomatic missions and international organisations will also be allowed to own property for official use, subject to Foreign Ministry approval and reciprocity. Mandatory registration and oversight Non-Saudi entities must register with the relevant authorities prior to acquiring real estate. Legal ownership or rights will only be recognised following registration in the national real estate registry. To enforce compliance, the law introduces a real estate transfer fee of up to 5 per cent for transactions involving non-Saudis. Violations could incur fines of up to SAR10m, with penalties including forced sales in severe cases such as the use of falsified documents. Proceeds from such sales will be transferred to the state after necessary deductions. A committee under the Real Estate General Authority will be established to monitor violations and impose sanctions. Affected parties can appeal committee decisions to the administrative courts within 60 days. Repeal of previous rules for GCC citizens The new law also revokes a previous ban on real estate ownership by Gulf Cooperation Council (GCC) citizens in Makkah and Madinah, thereby aligning the rules for all non-Saudi individuals and entities under a single legal framework. Executive regulations, including geographic boundaries and implementation procedures, are expected to be issued within six months. The law replaces the previous foreign ownership legislation issued under Royal Decree No. M/15 in 2000.
Argaam
6 days ago
- Business
- Argaam
KSA issues law on non-Saudis property ownership
Saudi Arabia issued today, July 25, the law on non-Saudis property ownership, which has been recently approved by the Cabinet. The 15-Article law will come into effect 180 days after publication in the Official Gazette. Based on Article 2 of the law, non-Saudis may own real estate or acquire other in-kind rights over property within the Kingdom, in the geographic scope determined by the Cabinet. The Cabinet shall determine the geographic scope where non-Saudis may own real estate or acquire other rights in kind over property, the type of these rights, the maximum ownership percentages for non-Saudis within the defined geographic scope, the maximum period permitted duration for non-Saudis to acquire usufruct rights over property, along with any regulations related to non-Saudis owning property or acquiring in-kind rights. A non-Saudi natural person who is legally residing in the Kingdom may own one property designated for personal residence outside the geographic scope referred to above—excluding the cities of Makkah and Madinah. The right of non-Saudis to own property or acquire other in kind rights—mentioned in the above section—within the cities of Makkah and Madinah shall be limited to Muslim natural persons only. Moreover, the law stipulates that without prejudice to any fees or taxes prescribed by law, a fee shall be imposed and collected by the Authority on the value of a non-Saudi's disposal of in-kind rights over property in the Kingdom, not exceeding 5% of that value. Without prejudice to any fees or taxes prescribed by law, the authority shall impose a fee of no more than 5% of the value of the non-Saudi's disposal of real estate rights in the Kingdom. In the event of a violation of this law—and without prejudice to any harsher penalty stipulated in another law—any person who violates this law shall be penalized.
