Saudi Arabia is allowing foreign nationals to own real estate under a new legal framework set to take effect in January 2026, clearly defining where foreigners can buy property, what types of real estate they can own, and the legal limits that will apply across the Kingdom. The move marks a significant shift in the country’s approach to real estate, offering opportunities for investment while maintaining clear regulatory oversight.
A nationwide opening, with key city exceptions.
Saudi Gazette reported that, the Minister of Municipalities and Housing Majed Al-Hogail confirmed that the updated system will allow foreigners to own residential property in most Saudi cities, marking a significant shift from previous restrictions.Residential ownership by foreigners will be permitted across the Kingdom, with four notable exceptions:
- Makkah
- Medina
- Jeddah
- Riyadh
While these cities are excluded from general residential ownership, authorities may later designate specific zones within them where non-residents can own property, subject to approval.For non-Saudi residents living in the Kingdom, the law allows ownership of one residential unit outside designated ownership zones. This applies nationwide, except in Makkah and Madinah, where residential ownership remains restricted to Muslims only.Non-residents, on the other hand, will be allowed to own property only in areas specifically designated and approved by authorities.
Commercial, industrial, and agricultural ownership fully opened
In contrast to residential rules, the framework takes a more expansive approach to business related property.Foreigners will be allowed to own:
- commercial properties
- industrial properties
- agricultural properties
This access will apply in all Saudi cities without exception, signaling a clear intent to encourage foreign investment, industrial growth, and agricultural development throughout the Kingdom.
Legal framework and controls
The updated system is designed to regulate foreign ownership by setting clear geographic boundaries, ownership limits, and legal controls. Non-Saudis can own property or acquire real estate rights only in areas designated by the Council of Ministers. These designations are based on recommendations from the Real Estate General Authority and approved by the Council of Economic and Development Affairs.Authorities will define the types of real estate rights allowed, the maximum ownership ratios, and all related conditions. The framework ensures that foreign ownership does not grant additional privileges beyond those defined by law and does not affect rights under other programs such as the Premium Residency Program or agreements with Gulf Cooperation Council countries.
Registration rules, fees, and penalties
All non-Saudi individuals and entities must register with the relevant authorities. Ownership will only be legally recognized once it is recorded in the Real Estate Registry. A transaction fee of up to 5% of the property value will apply to foreign ownership, with details to be specified in the executive regulations.Violations of the law may result in fines or warnings, while providing false information can lead to fines of up to SR10 million and, in certain cases, a court ordered sale of the property.Through these measures, Saudi Arabia aims to open its real estate market to foreign nationals while ensuring transparency, regulatory clarity, and controlled growth across both residential and commercial sectors.
