A Game-Changer in Saudi Arabia's Real Estate Market | Foreign Ownership Now Possible

In a strategic move aimed at boosting the flow of foreign direct investments, the Saudi Council of Ministers approved on Tuesday an updated system allowing non-Saudis to own property. The new law is set to come into effect starting January 2026.

Majid Al-Hogail, Minister of Municipal and Rural Affairs and Housing, explained that the approval of this system is part of a series of legislative efforts to grow the real estate sector and encourage foreign investment. This aims to expand real estate supply and attract development companies and investors to the Saudi market.

Al-Hogail noted that the new system strikes a balance between promoting investment and protecting citizens' interests through regulatory mechanisms that ensure compliance and property market control, fostering market stability while considering both economic and social dimensions.

Designated Geographic Areas The minister clarified that the system allows foreign ownership of real estate within specified geographical areas, especially in the cities of Riyadh and Jeddah. Ownership in Mecca and Medina will be subject to special requirements. According to the system, the General Real Estate Authority will be responsible for proposing the permitted areas for ownership or the acquisition of other real property rights.

The Authority is expected to issue the executive regulations for the system within 180 days of its publication in the official gazette. These will be released through the "Istitlaa" (Consultation) platform and will include detailed procedures for foreign ownership, compliance requirements, and implementation mechanisms that take economic and social considerations into account.

Alignment with Existing Regulations The updated system is in line with the Premium Residency system and the regulations that allow citizens of Gulf Cooperation Council (GCC) countries to own property within member states for residential or investment purposes. It also aligns with current laws granting foreign nationals ownership privileges and other real property rights.

Supporting Vision 2030 This decision is part of Saudi Arabia’s broader efforts to meet the objectives of Vision 2030, which aims to diversify sources of national income, create an attractive investment climate, and develop non-oil sectors—particularly real estate, which is a fundamental pillar of economic and social development.

Historical Background It is worth noting that foreign ownership of property in the Kingdom has been allowed since 2000, under investment conditions that included a minimum capital requirement of 30 million SAR. In recent years, several regulations have been amended to allow foreign investors—including non-residents—to own property, in line with the Kingdom’s evolving economic direction.

Edited by: Imtilak Global ©