In a historic step reflecting Saudi Arabia’s ambitions to diversify its economy and enhance its real estate sector, the Saudi Cabinet approves new property ownership law for foreigners The Saudi Cabinet, led by Crown Prince Mohammed bin Salman, has officially approved the Saudi’s property ownership law for foreigners This law, which will take effect in January 2026, allows non-Saudi nationals to own property in specific designated zones, primarily in Riyadh and Jeddah, with tailored provisions for the holy cities of Makkah and Madinah. This legislation opens the doors for unprecedented foreign investment in Saudi Arabia’s real estate market, aiming to boost the housing supply while safeguarding citizens’ interests.
The announcement follows an extensive public consultation process facilitated by the Ministry of Investment and the Real Estate General Authority (REGA), reflecting the Kingdom’s commitment to transparency and public participation in policy making. This move is expected to significantly transform the landscape of foreign property investment in Saudi Arabia and align with Vision 2030’s goals for economic diversification and sustainable development.
Saudi’s Property Ownership Law for Foreigners Aims
The primary objective of the Saudi’s property ownership law for foreigners is to create a balanced and dynamic real estate market that attracts foreign direct investment (FDI), enhances the housing supply, and contributes to the overall economic development of the Kingdom. According to Majid Al-Hogail, Minister of Municipal, Rural Affairs and Housing and Chairman of REGA, the new law is crafted to ensure that while foreign investors gain new opportunities, the interests of Saudi citizens remain protected.
The law introduces a regulated framework that clearly defines where and under what conditions foreigners can own property, thus minimizing speculative practices and market distortions. Moreover, by expanding foreign ownership rights in a controlled manner, Saudi Arabia seeks to stimulate the real estate sector’s contribution to GDP, which has recently doubled from 5.9% in 2023 to approximately 12% in 2024, supported by strong policy reforms.
A significant aim is also to align property ownership regulations with the Kingdom’s economic diversification strategy, thereby encouraging long-term foreign investment in residential, commercial, and hospitality real estate projects.
Foreign Ownership of Real Estate in Saudi Arabia 2025
The new legislation specifically permits foreign ownership of real estate within designated geographic zones, with Riyadh and Jeddah being the major cities approved initially. These urban centers are focal points for Saudi Arabia’s rapid economic growth and population expansion, making them strategic hubs for real estate investment.
Special provisions are applied for the holy cities of Makkah and Madinah, where property ownership by foreigners is more tightly regulated due to religious sensitivities. In these cities, foreign ownership is typically limited to investments through publicly listed real estate developers or companies, with ownership caps and conditions that ensure the sanctity of these areas is preserved.
REGA is charged with the important responsibility of defining the approved zones for non-Saudi ownership. The authority is also tasked with drafting executive regulations that will be open for public consultation on the Istitlaa platform within 180 days, ensuring transparency and stakeholder input before finalization.
This phased and controlled approach is designed to maintain market equilibrium and provide clarity to foreign investors about where and how they can participate in Saudi Arabia’s real estate market.
Conditions for Foreigners to Own Property in Saudi Arabia 2025
Foreign property ownership under the new law comes with several important conditions intended to regulate the market and ensure compliance with national interests:
- Designated Zones: Foreign ownership is limited to geographic areas specified by REGA, currently including Riyadh, Jeddah, and other development-focused economic regions.
- Purpose of Ownership: Properties acquired by foreigners must be for residential use or investment purposes. This prevents misuse of real estate assets and aligns with housing market needs.
- Special Cases for Holy Cities: In Makkah and Madinah, foreign ownership is restricted to investments via Tadawul-listed real estate companies or convertible debt, with foreign ownership capped at 49% to protect the sanctity of these locations.
- Alignment with Premium Residency: The law harmonizes with existing regulations allowing holders of Saudi Arabia’s premium residency program to own property, granting them rights similar to Saudi nationals.
- Registration and Approval: Ownership transactions must be processed through official platforms such as Absher, ensuring proper documentation, transparency, and government oversight.
Benefits of Foreign Property Ownership in Saudi Arabia
The enactment of Saudi’s property ownership law for foreigners brings numerous benefits that extend across economic, social, and market dimensions:
Attracting Foreign Direct Investment (FDI)
Opening up property ownership to foreigners is a strategic move to attract substantial FDI, a cornerstone for economic diversification under Vision 2030. Real estate investments are expected to flow into residential developments, commercial projects, and hospitality, helping to create jobs and stimulate related industries like construction and services.
Supporting Housing Supply and Market Growth
With Saudi Arabia’s population expanding rapidly and urbanization accelerating, foreign investment can significantly contribute to increasing the housing supply, especially in major cities like Riyadh and Jeddah. This helps meet demand and stabilize housing prices, benefiting both residents and investors.
Enhancing Market Regulation and Transparency
The law establishes clear regulatory frameworks and mechanisms, reducing speculative real estate activities and promoting fair market practices. The use of digital platforms like Absher for property ownership management further ensures transparency, efficiency, and legal certainty.
Boosting Economic Diversification and Development
As the real estate sector’s contribution to GDP rose dramatically in recent years, foreign ownership rights will help sustain this growth trajectory. The influx of global capital is expected to enhance economic activities beyond oil, contributing to a diversified and resilient Saudi economy.
Enabling New Investment Opportunities
Foreign investors can leverage ownership rights to invest in both residential and commercial real estate, participating in Saudi Arabia’s ongoing urban and economic transformation. This creates a more attractive environment for expatriates, business professionals, and global funds.
Ownership for Residential Purposes
One of the key provisions of the Saudi’s property ownership law for foreigners is the explicit allowance for foreign nationals to own property for residential purposes in designated zones. This provision enables expatriates, foreign business professionals, and premium residency holders to establish permanent or temporary homes in Saudi Arabia’s rapidly developing cities.
The ability to own residential property is expected to encourage long-term residency and investment, fostering a more diverse and stable community within urban areas. It also aligns with the Kingdom’s goals to attract skilled expatriates and international talent by providing flexible and secure housing options.
Property Ownership for Holders of the Premium Residency
The new law aligns closely with regulations governing holders of Saudi Arabia’s premium residency program, which offers expatriates extended residency rights and privileges. Premium residency holders are entitled to own real estate for both residential and investment purposes, with rights similar to those of Saudi nationals.
This alignment simplifies legal frameworks and encourages affluent foreign residents to invest in the Kingdom’s property market confidently. The premium residency program, combined with enhanced property ownership rights, positions Saudi Arabia as a competitive destination for global investors and professionals.
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Property Ownership for Non-Saudis via Absher
To ensure a seamless and transparent process for foreign property ownership, all transactions and registrations will be handled through Saudi Arabia’s e-government platform, Property Ownership for Non-Saudis via Absher Platform This digital platform streamlines property registration, transfers, and ownership management, providing a secure and efficient mechanism for both buyers and regulatory authorities.
Using Absher minimizes paperwork, expedites approvals, and offers real-time tracking of property ownership status. This technology-driven approach reflects Saudi Arabia’s broader digital transformation goals and commitment to providing investor-friendly environments.
In conclusion, the Saudi’s property ownership law for foreigners marks a pivotal evolution in Saudi Arabia’s real estate and investment landscape. By defining clear zones, conditions, and digital processes for foreign property ownership, the Kingdom is positioning itself as a more open, attractive, and regulated market for international investors. This law supports the government’s Vision 2030 ambitions by encouraging foreign direct investment, boosting housing supply, and fostering sustainable urban development.
We invite investors, expatriates, and real estate enthusiasts to follow the upcoming executive regulations and public consultations on official platforms to fully leverage these new opportunities. For ongoing updates, detailed market insights, and expert advice on Saudi Arabia’s real estate sector, visiting trusted resources such as the Bayut Saudi Arabia blog will keep you informed and empowered in this rapidly evolving market.
