With the new law coming, Saudi Arabia will soon be a top pick for foreigners who want to invest in real estate.
In 2025, government data confirms that the number of professional expatriates in The Kingdom has increased more than six times, rising from roughly 200,000 to over 1.2 million, driven by Vision 2030 reforms, new residency options, and major job creation in Riyadh, Jeddah, and NEOM. It is clear that more people are looking to live, work, and invest in KSA. This makes sense, since the country now offers world-class infrastructure, a rapidly growing tourism ecosystem, and a business-friendly environment supported by REGA (Real Estate General Authority) and the Ministry of Investment.
However, buying property in a foreign country can be complicated, especially with new regulations such as the 5% Real Estate Transaction Tax (RETT), valuation rules overseen by Taqeem-certified valuers, and ownership eligibility requirements for non-Saudis.
Don’t worry. This guide is designed to help foreign buyers understand how the property market works in Saudi Arabia in 2025.
We will cover everything you need to know in a clear, practical way, including eligibility, permitted regions, financing options through banks and mortgage companies backed by the Saudi Real Estate Refinance Company (SRC), and the upcoming buyer protections under the new regulatory framework.
If you still have questions, just contact us.
For deeper market research, pricing trends, and legal guidance, you can also check our property pack for Saudi Arabia, created by our market expert team and reviewed by local real estate professionals.
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Can you purchase and own a property in Saudi Arabia as a foreigner?
Background and current restrictions
Saudi Arabia still has regulated pathways for foreign individual property ownership in 2025, and these rules limit who can legally purchase and hold real estate.
Before 2021, foreign ownership was almost impossible without a very specific investment license. Since then, Saudi Arabia has introduced new legal provisions allowing non-Saudi residents to buy a single residential property under a controlled framework monitored by the Real Estate General Authority (REGA) and the Ministry of Investment (MISA).
Below are the most relevant restrictions as of 2025:
– Foreign buyers must hold a valid Iqama residency permit. A regular Iqama is sufficient; Premium Residency (Golden Iqama) provides more flexibility but is not a mandatory requirement to purchase one residential unit.
– Land ownership is still prohibited for foreigners unless classified as an approved investment project under MISA. Regular foreign buyers cannot purchase empty land or agricultural plots.
– Makkah and Madinah remain restricted ownership zones. Foreigners are not permitted freehold ownership in these areas, although legally registered usufruct rights (long-term use rights) for up to 99 years are available in some developments.
– Property must be residential only unless a special commercial permit is issued. Using a property for holiday rental, serviced apartment operations, or Airbnb-style income requires separate licensing.
– Official approval is required, and all transactions must be registered in the Ministry of Justice real estate registry and comply with Taqeem-certified property valuation rules to prevent fraud and overpricing.
– Border, military, and protected zones remain prohibited without exception. These areas are updated regularly in government circulars.
– The maximum property size generally allowed for foreign individual ownership remains around 3,000 square meters, although exceptions may apply in designated investment zones or Vision 2030 strategic developments.
– A resident foreigner may own only one property in the Kingdom, unless holding an investment-based Premium Residency category with explicit authorization for multiple units.
These restrictions apply almost uniformly to all non-GCC nationals. There is no difference in rules for U.S., U.K., Canadian, European, Indian, or Asian buyers — the criteria are the same under current Saudi regulations.
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New regulations and what is (probably) changing
Good news if you are a foreigner looking to buy property in Saudi Arabia.
As part of its Vision 2030 strategy to diversify the economy and increase foreign capital participation, Saudi Arabia is finalizing a new legal framework that will expand property ownership rights for non-Saudi nationals.
The original announcement was made by Abdullah Alhammad, Head of the Real Estate General Authority (REGA), in March 2023, and since then, the initiative has progressed through multiple review stages involving the Ministry of Investment (MISA), the Ministry of Justice, and the Council of Ministers.
While the full regulation has not been published yet, Saudi authorities confirmed in 2025 that the legal drafting work is nearing completion and is expected to be disclosed publicly once implementation procedures are finalized. As soon as the new law is officially released, we will update this article immediately. Customers who own the Saudi Arabia Property Pack will receive a clear explanation of the changes and their practical implications.
Early statements from regulators indicate that the new law is expected to offer a broader and more flexible framework compared to the current rules, with the objective of:
– Encouraging long-term foreign residency
– Increasing transparency and real estate registration through digital platforms
– Supporting investment in new economic zones and strategic tourism destinations
At present, Saudi law prohibits foreigners from buying property outright in holy cities such as Makkah and Madinah, although long-term usufruct agreements (up to 99 years) are available in some developments.
Preliminary comments from officials have suggested that the upcoming regulation may relax restrictions in specific zones, but there has been no confirmed statement guaranteeing full freehold foreign ownership in Makkah and Madinah. Any future ownership structure in these cities is expected to be controlled, limited to designated developments, and monitored by REGA rather than fully open freehold.
In addition, early policy drafts indicate that new rights may allow foreigners to own a wider range of property types, potentially including:
– Residential homes
– Commercial units and offices
– Agricultural land in approved investment corridors
– Mixed-use real estate in economic and tourism development zones
Until the final law is enacted, existing restrictions remain in force, but the overall direction of reform in 2025 is clearly expanding access and increasing legal certainty for foreign investors.
Read: Renting Property In Saudi Arabia As A Foreigners
Nitaqat, joint ventures and leasehold
Direct ownership is not the only way to own a place in KSA.
Foreigners can also invest in Saudi Arabian real estate through joint ventures or partnership agreements with Saudi nationals or licensed Saudi entities. These arrangements are still common in 2025, especially for commercial and mixed-use real estate projects.
Leasing options, such as long-term leases or long-term leaseholds, are also available. It is not technically ownership, but it remains a practical solution if you want to settle long-term in the Kingdom while complying with current property regulations.
Finally, there is the Nitaqat program in Saudi Arabia, which promotes hiring locals and reducing unemployment among Saudis. Companies are classified based on how many Saudis they employ and receive rewards or restrictions depending on their category. This program continues to affect how foreigners can own property, because companies with a higher Nitaqat rating may make it easier for foreign employees to access housing benefits, long-term leases, and potentially improved approval conditions related to owning a home.
Gulf nationals
Citizens of Gulf Cooperation Council (GCC) countries are allowed to own properties in Saudi Arabia, with a maximum limit of three properties.
The property area should not exceed 3,000 square meters. The ownership must be for residential purposes, and if the property is classified as land, it must be developed within six years from the date of registration under current Saudi regulations.
As of 2025, a GCC buyer is still required to register the transaction electronically through the Ministry of Justice real estate portal. No major commercial activity is permitted unless the buyer holds a separate business license.
No transactions are allowed on the property until four years have passed from the registration date, and this waiting period remains part of the rules designed to prevent speculative trading in Gulf ownership cases.
What does the real estate market look like in Saudi Arabia?
Market data
If you were to ask anyone today, they would likely complain about the current prices in Saudi Arabia, especially in the major cities. This sentiment still appears in professional reports in 2025, and we have summarized the latest policy shifts, pricing trends, and market dynamics in our Saudi Arabia Property Pack.
In Saudi Arabia, many people aspire to own their own homes, but the prices remain prohibitively high. For instance, recent Knight Frank survey data shows that a significant majority of residents in Riyadh (around 84%) and Jeddah (approximately 85%) express interest in buying properties in their respective cities, yet affordability continues to be a challenge.
Many local market analysts and partners living in Riyadh confirm that the real estate landscape is influenced by a relatively small group of large developers and landholding entities. This contributes to rising prices and limited inventory. Additionally, Saudi Arabia remains highly centralized, with most economic and administrative activities centered in Riyadh, making it a desirable location and pushing prices upward.
In fact, major Saudi cities like Riyadh and Jeddah are still grappling with chronic supply shortages in 2025, which results in steep property pricing that many households consider out of reach.
Moreover, demand for houses in Saudi Arabia continues to rise due to government housing initiatives. One of the most referenced plans was introduced in 2011, when King Abdullah announced a program to build 500,000 homes and allocated roughly $67 billion in government funding. Since then, multiple initiatives from the Ministry of Housing and Sakani platform have continued to support Saudi nationals with home ownership solutions.
The Saudi government has also expanded several schemes to provide housing assistance to citizens, including state-subsidized home loans and mortgage support throughout the banking system. Instead of paying rent, many residents have used low-interest or interest-free loans to purchase their properties.
This trend may continue under Vision 2030, which targets increasing home ownership among Saudi nationals to at least 70%–75% by the end of the decade. Substantial funding has been directed toward this objective. Since the start of Saudi Arabia’s National Transformation Program in 2016, the combined value of real estate and urban development projects has exceeded $1.1 trillion in committed development pipeline, spanning residential, commercial, hospitality, and infrastructure.
Saudi Arabia is currently home to numerous megaprojects in various stages of development, with NEOM being the most ambitious. NEOM is expected to accommodate millions of future residents across multiple regions and new urban communities.
Prices are likely to increase in emerging suburban areas and Vision 2030 zones such as Oxagon, Sindalah, Trojena, and The Line, which aim to introduce new standards for luxury living in the region and have drawn robust domestic and international interest.
If you have the budget for investment, property can be an attractive option due to promising rental yields. According to recent Numbeo data, rental properties in Saudi Arabia typically offer gross rental yields ranging from approximately 5.6% to 8.3%, depending on the city and neighborhood.
Furthermore, when looking at wealth indicators, IMF data shows that Saudi Arabia’s GDP per capita has increased over the past five years. Combined with population growth, strong job creation for expatriates, and Vision 2030 foreign investment reforms, the demand for real estate is likely to remain high.
If you want to know more about timing and market cycles, we have written an article to understand whether it’s a good time to buy property in Saudi Arabia now. In that article, we use reliable data solely from primary sources, just as we did in our research reports and documents about real estate in Saudi Arabia.
The expat life
The life of an expat in Saudi Arabia can be an exciting and rewarding experience, but it can also be very challenging. Expats in Saudi Arabia must be prepared for a different way of life, with different customs and laws.
The climate in Saudi Arabia is hot and dry, with temperatures reaching up to 50°C in the summer months. The country is also very conservative, and expats must adhere to the local dress code and cultural norms.
The cost of living in Saudi Arabia is relatively low, but expats must be prepared for a higher cost of living compared to their home country. Expats must also be aware of the laws and regulations in Saudi Arabia, as the country has strict laws and penalties for breaking them.
The job market in Saudi Arabia is strong and there are many opportunities for expats. The country is also very welcoming to expats, and there are a variety of activities and experiences to enjoy.
Overall, life as an expat in Saudi Arabia can be an exciting and rewarding experience. Expats must be prepared for a different way of life and must be aware of the laws and regulations in the country. But with the right attitude and preparation, expats can make the most of their experience in Saudi Arabia.
What are the best places to invest in real estate in Saudi Arabia?
Riyadh is the capital and largest city in Saudi Arabia, making it a prime location for investment. It is still the political, economic, and financial hub of the country in 2025. The city offers a wide range of residential and commercial properties, catering to various budgets. Popular neighborhoods include Al Olaya, Diplomatic Quarter (DQ), Al Nakheel, and new development corridors closer to King Salman Park and Diriyah Gate.
There is also Jeddah, which is a major port city and commercial center on the Red Sea coast. The city is known for its vibrant culture, diverse expatriate community, and proximity to Mecca. Areas such as Al Hamra, Al Andalus, and Al Rawdah continue to be popular for real estate investment, especially with ongoing waterfront redevelopments.
We can also mention Dammam and Al Khobar, two key cities in the Eastern Province that benefit from strong economic links to oil, logistics, and cross-border trade with Bahrain via the King Fahd Causeway.
To make it clearer, we have made this table, which summarizes some of the best places to buy a property in Saudi Arabia.
As mentioned earlier, for the moment, you cannot own a property as a foreigner in Mecca or Madina (only 99-year lease arrangements are permitted in designated developments). The new law might change that once implementation is finalized.
| City / Region | Population | Average Price per sqm (SAR) | Strengths |
|---|---|---|---|
| Riyadh | ≈ 7.9 million | 5,000 – 9,000 | National capital, economic hub, major Vision 2030 projects |
| Jeddah | ≈ 4.5 million | 4,000 – 8,000 | Commercial center, Red Sea coast, cultural diversity |
| Mecca | ≈ 2 million | 4,000 – 8,000 | Holy city, pilgrimage demand, long-term lease potential |
| Madina | ≈ 1.5 million | 3,500 – 7,000 | Holy city, peaceful lifestyle, spiritual tourism |
| Dammam | ≈ 1 million | 4,000 – 8,000 | Eastern Province hub, oil economy, port access |
| Al Khobar | ≈ 650,000 | 4,000 – 8,000 | Commercial center, expat community, waterfront lifestyle |
| Abha | ≈ 500,000 | 3,000 – 6,000 | Mountain climate, natural scenery, tourism growth |
Do you need a lawyer to buy real estate in Saudi Arabia?
When purchasing a property in Saudi Arabia, engaging a local lawyer can provide valuable assistance in navigating the legal aspects and ensuring a successful transaction, especially for foreign buyers who are unfamiliar with local regulations.
One crucial document they can help you with is the Property Sale Agreement (Akad Bait), a legally binding contract between the buyer and seller that outlines the terms and conditions of the sale, payment timelines, and all obligations on both sides.
A Saudi Arabian lawyer can also assist with conducting a Property Title Search (Tafsil Malikiyah) to verify the property’s ownership status, confirm that the title is properly registered under the Ministry of Justice, and identify any potential legal issues or encumbrances on the property.
Furthermore, they can guide you through the process of obtaining necessary permits and approvals, such as approval from the Ministry of Municipal, Rural Affairs and Housing, or other relevant authorities depending on the property type and location.
They will also ensure that all applicable taxes and fees, such as the Real Estate Transaction Tax (RETT) and notary registration fees, are paid correctly and in full compliance with Saudi Arabian laws and regulations. Lawyers familiar with foreign ownership rules can also advise you on recent changes under Vision 2030 related to electronic registration, Taqeem valuation standards, and deal structuring.
What are the risks when purchasing a property in Saudi Arabia?
When buying a property in Saudi Arabia, there are a few unique risks to consider that are not common in other countries.
We have made a complete overview of the risks and how to avoid them in our Saudi Arabia Property Pack, based on legal reviews, title deed requirements through the Ministry of Justice, and feedback from real estate experts who operate locally.
For a shorter version, you can check our article about the common mistakes foreigners make when buying property in KSA. These issues are still relevant in 2025, especially for buyers who are unfamiliar with local procedures, financing structures, and cultural expectations.
Here is also a summary table we’ve made for you.
| Mistake / Pitfall | Description | Prevention Tips |
|---|---|---|
| Not aligning prayer areas with the Qibla | Failing to ensure that prayer areas in the property face Makkah (Mecca) can lead to dissatisfaction and affect resale value. | Verify the Qibla direction, use Qibla compasses or apps, consult local religious authorities if needed. |
| Not understanding the Ijara contract | Misunderstanding the terms of an Ijara contract, a common financing method in Saudi Arabia, can lead to disputes and misunderstandings. | Fully understand payment structure, maintenance responsibilities, and conditions for property ownership transfer. |
| Buying land designated for sustainable resource management | Purchasing property within Hima zones without understanding the restrictions can lead to legal issues and unexpected responsibilities. | Research the property thoroughly, seek legal advice regarding Hima-designated land. |
| Not having your name on the title deed | Not being aware of the “tanazul” system can put foreign buyers at risk as the property’s title deed remains under a Saudi national’s name. | Be aware of the risks associated with tanazul arrangements, including limited legal recourse. |
| Not considering Vision 2030 developments | Failing to research future development plans in the area may lead to property issues, including expropriation and changes in the neighborhood’s character. | Thoroughly research development plans, consult reliable real estate experts, and assess long-term impacts. |
| Not verifying the title deed properly | Inadequate investigation of the property’s title deed, zoning regulations, and land use permissions can result in unexpected limitations and disputes. | Work with local real estate professionals familiar with Saudi Arabian property market and zoning regulations. |
| Not being familiar with the Hijri calendar | Lack of understanding of the Hijri calendar can lead to misunderstandings, miscalculations, and potential legal issues in property transactions. | Know which calendar is used in documents, convert and calculate dates accurately, especially for payment schedules and milestones. |
| Overlooking undocumented rights of way | Ignoring informal access rights on a property can lead to disputes with locals and restrictions on land use and development. | Conduct thorough due diligence, engage with local communities, consult legal experts, and understand cultural dynamics. |
| Buying property with fragmented ownership | Saudi Arabia’s inheritance laws can result in complex, fragmented property ownership, making consolidation and purchase challenging. | Ensure clear and undisputed ownership before proceeding with a sale, resolve disputes among owners if necessary. |
What are the required documents for a real estate transaction in Saudi Arabia?
When buying a property in Saudi Arabia, the documents needed include:
– A letter specifying the type, size, and location of the property.
– A copy of your current passport, along with another copy of your initial passport registered upon your first entry into the Kingdom.
– A copy of your valid residence permit and that of your spouse.
– A letter from your employer to prove your income, good conduct, and employment status.
– A copy of the property deed registered through the Ministry of Justice electronic title system.
– A copy of the building permit (if any), issued by the local municipality.
– A copy of the survey report (Takhsees) showing land boundaries and coordinates.
– A copy of your bank statement for the last six months.
– A building map or layout plan to clarify the dimensions of the property and its surroundings.
– A written statement confirming that the property is for residential use and not intended for commercial activity without a separate permit.
In 2025, many transactions are completed electronically through the Ministry of Justice’s digital platforms and local municipality portals, but foreign buyers should still keep physical copies of all documents, especially those related to title registration, Taqeem valuation reports, and bank financing records.
How are the property prices decided in Saudi Arabia?
In Saudi Arabia, property prices for private and commercial land are determined by the Property Shaikh, known as Shaikh Al Aqar, rather than property owners or estate agents.
People can easily access his services when buying or selling property. It’s not mandatory. Nonetheless, during price negotiations, you can confidently use the property’s value as determined by Shaikh’s written estimate as a reference for your offers.
You have to know that he has a fixed 2.5% fee on all property sales, motivating them to secure the highest possible price for their selling clients.
To evaluate a property, you can invite Shaikh Al Aqar to conduct a survey and inspection.
After the survey, he provides a written evaluation, considering factors like location, type, size, and condition of the property, as well as potential improvements. He offers two prices in the report: the current market price of the property and the price of the land it occupies.
Even if you’ve already bought a property, Shaikh Al Aqar can still survey it and provide a report. This report can be used to revise a purchase agreement if you believe you paid too much or encountered unforeseen issues.
Saudi people trust and respect his property evaluations due to his reputation for honesty and integrity. His office is accountable to both the government and the public, ensuring accuracy and fairness in his price assessments.
Do banks offer loans to foreigners in Saudi Arabia?
In theory, foreigners can get property loans in Saudi Arabia, subject to certain conditions and eligibility criteria.
If you are a foreigner planning to obtain a property loan in Saudi Arabia, consider exploring Sharia-compliant financing options offered by local banks, such as Murabaha or Ijara, in accordance with Islamic principles.
Some banks in Saudi Arabia that can grant a mortgage to a foreigner include Al Rajhi Bank, National Commercial Bank, Riyad Bank, Saudi British Bank (SABB), Arab National Bank, and Bank AlJazira.
If you’re planning to secure financing through a bank, your salary must be at least 25,000 SAR and your job should be in the government sector or semi-government sector.
Also, you’ll need to make an upfront payment equal to 50% of the total property price. For instance, if a property is valued at 500,000 SAR, you must provide 250,000 SAR and obtain the remaining 250,000 SAR from a bank.
Furthermore, in Saudi Arabia, mortgage rates for a 20-year term range between 2% and 6%, providing borrowers with highly competitive conditions for securing financing. The maximum loan period is 10 years.
What are the taxes related to a property transaction in Saudi Arabia?
Here is a breakdown of taxes related to a property transaction in Saudi Arabia.
| Tax | Description | Calculation | Who pays |
|---|---|---|---|
| Real Estate Transaction Tax (RETT) | Tax on property transfer | 5% of the property sale price | Buyer |
| Zakat | Islamic wealth tax | 2.5% of the property value | Seller |
| Capital Gains Tax | Tax on capital gains from property sales | 30% on the net capital gains (difference between sale and cost prices) for businesses | Seller |
| Rental Income Tax | Tax on rental income generated from the property | 5% on the gross rental income for non-residents | Owner |
For a more detailed calculation, refer to:
– the Zakat and Tax Authority, Saudi Arabia’s website
What fees are involved in a property transaction in Saudi Arabia?
Below, you’ll find a list of fees involved in a property transaction in Saudi Arabia.
| Fee | Description | Calculation | Who pays |
|---|---|---|---|
| Municipality Fee | Fee imposed by the local municipality | Varies depending on the municipality and type of property | Buyer |
| Real Estate agent Commission | Fee paid to real estate agent or broker | 2.5% of the value of the sold property | Seller |
| Notary Fee | Fee for notarizing property transfer documents | Varies depending on the notary office | Buyer |
| Title Registration Fee | Fee for registering the property transfer | 1% of the property sale value or the approved valuation by the Real Estate Department, whichever is higher | Buyer |
