Saudi Arabia Moves Closer to Opening Its Real Estate Doors

Saudi Arabia is revealing more about its plan to welcome foreign real estate owners in just a few weeks.

Non-Saudis will be allowed to buy real estate and developable land in the nation as soon as January, Bloomberg reported. Residential, commercial, industrial and agricultural properties will all be available to foreigners, according to the Real Estate General Authority.

Ownership rules will be more complicated for the country’s holy cities, Mecca and Madinah, where only Muslim buyers would be allowed.

Designated ownership zones are being reviewed for those cities, as well as major cities Riyadh and Jeddah. Those zones are expected to include megaprojects in the cities and will likely be capped at 70 to 90 percent non-Saudi ownership.

Rules and regulations over foreign ownership are not finalized, but are nearing an approval stage, according to the REGA.

“Our main purpose is to fully open the market, to enable the foreigner to visit Saudi, to buy and to supply real estate,” Fahad BinSulaiman, executive director for non-Saudi real estate ownership at REGA, said in an interview.

This week, REGA introduced the Saudi Properties portal, which will help facilitate transactions involving foreign buyers. Assets and geographic zone information will be uploaded to the portal soon.

The Saudi Cabinet in July approved legislation allowing foreign individuals, companies, non-profit organisations and investment entities to own or hold real rights over property across designated zones in the country. Outsiders will enjoy rights of ownership, leaseholds and other real estate interests.

Interested non-Saudi buyers will need to register with the relevant authorities before any property transaction. The government will only recognize the legal validity of ownership or real rights after buyers are entered into the national real estate registry.

A property transfer fee of up to 5 percent will also apply to transactions involving foreign buyers.

— Holden Walter-Warner