Summary
A comprehensive guide to the Non-Saudi Real Estate Ownership Law in force since 22 January 2026: who may own, the approved geographic zones, Mecca and Medina rules, fees, and how to apply.
A Historic Shift in the Saudi Property Market
On 22 January 2026, the Non-Saudi Real Estate Ownership Law — issued by royal decree in July 2025 — entered into force, opening the Kingdom's property market to non-Saudi individuals and companies to a degree unseen in decades. The legislative framework was completed by the Executive Regulations issued under Council of Ministers Decision No. 43, followed by the Geographic Zones document mapping the areas where ownership is permitted, in what proportions, and under what controls.
The new law replaces the 1421H law on non-Saudi real estate ownership and investment, moving from a philosophy of narrow exception to one of regulated openness: ownership is available as a rule within approved zones and restricted or prohibited outside them. The Real Estate General Authority supervises the framework, and applications are received electronically through the 'Saudi Real Estate' portal.
Who May Own, and What Does Ownership Cover?
The law broadens the circle of beneficiaries to multiple categories: non-Saudi individuals resident in the Kingdom, non-resident individuals abroad, and non-Saudi companies, funds, and entities. Each category has its own controls: resident individuals face requirements different from non-residents, and foreign companies with Saudi investment registration receive treatment reflecting whether real estate is their business activity or an operational need such as headquarters and staff housing.
Ownership extends beyond full freehold to a range of real rights — long-term usufruct and other rights in rem — opening flexible structuring options for investors. The Zones document sets maximum foreign ownership percentages within certain areas to preserve balance, and transitional provisions govern those who held property under the previous law or under existing international agreements.
Premium Residency holders remain in a distinctly favourable position — the Premium Residency programme granted residential ownership rights even before the new law, and the two frameworks now combine to give them the widest options.
Geographic Zones and the Special Status of Mecca and Medina
The essence of the new law is geographic: the first question for any investor is not 'may I own?' but 'where may I own?'. The Zones document adopts detailed maps of open areas, including substantial zones in principal cities such as Riyadh and Jeddah, with the Real Estate General Authority empowered to update the zones periodically according to urban planning and supply-demand considerations.
Mecca and Medina carry special provisions reflecting their status: ownership there is subject to stricter controls and defined cases — some tied to Muslim individuals, others requiring special approvals — and their rules cannot be extrapolated from other cities. We caution investors that marketing claims of 'ownership now open to foreigners across all of Saudi Arabia' are legally inaccurate. Verifying that the target property falls within an approved zone, at what percentage and under which controls, is the first step before paying any deposit — precisely what we undertake for clients in pre-transaction legal review.
Fees, Obligations, and How to Apply
Financially, disposals are subject to a real estate transaction fee not exceeding five percent as determined by the Regulations, in addition to any financial consideration prescribed for certain ownership categories. Owners carry continuing obligations — chiefly using the property for its licensed purpose and keeping records updated — and the law prescribes penalties for violations reaching substantial fines and, in cases of circumvention such as nominee ownership, forced sale of the property.
The practical application path: register on the 'Saudi Real Estate' portal; submit the application with supporting documents (residency ID or passport for individuals, commercial and investment registration for companies); automated verification that the property lies within an approved zone; payment of the applicable consideration; and finally electronic conveyance and title registration. The framework interlocks with the broader foreign investment regime: a foreign company typically needs an active investment registration before owning, so we advise building the property and investment plans together from the outset. Our foreign investment team provides an end-to-end service: zone and title verification, tax- and law-optimal ownership structuring, and management of the portal process through to title registration.