Foreign Real Estate Ownership Law in Saudi Arabia: The Complete Investor Guide

Foreign Real Estate Ownership Law in Saudi Arabia: The Complete Investor Guide

Mukhlid Al-Qahtani — CEO, Motaded Limited

What Actually Changed on 22 January 2026?

On 22 January 2026 (3 Sha'ban 1447H), the Foreign Real Estate Ownership Law formally entered into force in the Kingdom of Saudi Arabia, by decision of the Real Estate General Authority (REGA). The Law was promulgated by Royal Decree No. M/14 dated 19/01/1447H, and replaces the previous Foreign Real Estate Ownership and Investment Law issued under Royal Decree M/15 of 1421H, abrogating all conflicting provisions.

On 23 June 2026, the Council of Ministers approved both the Implementing Regulations and the Geographic Scopes Document defining the areas in which non-Saudis are permitted to acquire real estate. The applied framework is now complete. Motaded Limited has been tracking this legislative shift as part of its advisory services for foreign investors, and provides in this guide a precise legal reading of every material provision.

Key Differences Between the Old and New Laws

Who Now Has the Right to Acquire? The Four Eligible Categories

Article One of the Law defines a "non-Saudi" as comprising four categories, each subject to distinct controls. Motaded's foreign company setup team navigates these on behalf of clients on a routine basis:

Category One: Natural Person

Any person who does not hold Saudi citizenship, whether residing inside the Kingdom under valid Iqama or not. An ordinary resident may acquire one residential property for personal use after obtaining statutory approvals. A Premium Residency holder enjoys broader rights including multiple property acquisition under the Implementing Regulations. For Premium Residency details, see Motaded's dedicated service at motaded.com.sa/services/premium-residency-saudi-arabia.

Category Two: Non-Saudi Company

Foreign companies seeking to acquire real estate to conduct commercial activity in the Kingdom. Such companies must register with the Ministry of Investment (MISA) before acquisition via the "Invest in Saudi" platform, disclose direct and indirect owners, and appoint a statutory representative. Motaded provides an end-to-end MISA licensing service at motaded.com.sa/platforms/misa.

Category Three: Non-Saudi Non-Profit Entity

Includes foreign non-profit institutions and organizations. Their acquisition is subject to the designated geographic scope and registration requirements with the competent authority.

Category Four: Any Other Legal Person Designated by the Council of Ministers

A flexible authority enabling the Council of Ministers to expand the eligible base when needed, such as sovereign wealth funds or diplomatic entities.

Where Can Acquisition Take Place? The Approved Geographic Scopes

Article Two of the Law provides that the Council of Ministers determines — based on a REGA Board proposal and the Council of Economic and Development Affairs approval — five core elements: the geographic scope, the types of in-rem rights permitted, maximum ownership percentages, the maximum usufruct period, and any further controls.

On 23 June 2026, the Council of Ministers approved the following geographic scopes:

* Makkah and Madinah are subject to specific controls detailed in the next section.

Restrictions on Makkah and Madinah

Paragraph 4 of Article Two provides: "The right of a non-Saudi to acquire real estate or other in-rem rights — referenced in Paragraph (1) of this Article — over real property located in Makkah Al-Mukarramah and Al-Madinah Al-Munawwarah is restricted to a Muslim natural person."

Three substantive rules emerge from this text, which Motaded's real estate advisory team highlights to foreign clients:

▸  Eligible category in the Two Holy Cities: Muslim natural persons only (from inside or outside the Kingdom).

▸  Saudi companies incorporated under the Saudi Companies Law — even with non-Saudi shareholders — may acquire in Makkah and Madinah.

▸  Two exceptions: Sharia inheritance, and waqf established for a designated Saudi entity under Sharia controls with custodianship rights vesting in the competent waqf authority.

Notaries public and all competent authorities are prohibited from documenting any transaction that contravenes these provisions.

Complete Procedures by Beneficiary Category

For Residents Inside the Kingdom

A resident holding a valid Iqama may access the Saudi Properties portal directly at saudiproperties.rega.gov.sa using their Iqama number. The portal verifies eligibility automatically and the application is completed entirely online. The Implementing Regulations provide that the dependent spouse, ascendants, and descendants of the acquirer are deemed followers of the acquirer for residential property purposes, and none may individually acquire unless dependency lapses under accredited documentation.

For Non-Residents (Outside the Kingdom)

Non-residents begin their journey through Saudi embassies and representations abroad to issue the Digital Identity through the Ministry of Interior's "Absher" platform, in preparation for completing the acquisition request through the Saudi Properties portal.

For Foreign Companies Without Presence in the Kingdom

The company must first register with the Ministry of Investment via the "Invest in Saudi" platform, then complete its acquisition procedures on the Saudi Properties portal. Motaded Limited handles this complete pathway for its clients, from MISA licensing through linkage of the entity to the Real Estate Registry, via its advisory services at motaded.com.sa/services/business-setup.

Fees and Taxes

The Law provides verbatim: "Without prejudice to any statutorily prescribed fees or taxes, a fee shall be imposed and collected by the Authority on the value of a non-Saudi's transactions over in-rem rights on real property in the Kingdom, not exceeding (5%) of such value."

Three substantive legal observations:

▸  5% is the statutory ceiling, not the rate actually applied — the operative rate is determined by separate decision.

▸  This fee is separate from the Real Estate Transaction Tax (RETT) and the Real Estate Registry recording fees.

▸  REGA collects the fee directly through the Saudi Properties portal, not through ZATCA.

Penalties and the Violations Committee

Article Ten provides for the formation of one or more committees of no fewer than three members specialized in regulatory matters, charged with examining violations and imposing the penalties set out in the Law. The committee is formed by decision of the REGA Board of Directors, which also sets its rules of operation and members' remuneration.

Decisions of the committee may be appealed before the Administrative Court within sixty days of notification. Inspectors designated by the Authority undertake the recording and documentation of violations and may seek the assistance of judicial enforcement officers when needed.

The Law's Supervisory Committee — 13 Government Entities

To ensure implementation and monitor policy, the Council of Ministers established a unified Supervisory Committee comprising thirteen government entities:

Motaded's Role in the Foreign Real Estate Acquisition Journey

Motaded Limited (Commercial Registration 7009358164) has handled foreign company setup files in the Kingdom since 2017, with more than 281 foreign companies established. A foreign real estate acquisition file practically runs through two intertwined tracks that Motaded manages in parallel:

▸  Entity Formation Track: MISA licensing, Articles of Association drafting, Commercial Registration issuance, corporate bank account opening.

▸  Real Estate Acquisition Track: Eligibility verification, document preparation, registration on the Saudi Properties portal, in-rem registration follow-up.

These two services are inseparable in practice — a foreign investor cannot acquire commercial real estate without a registered legal entity, and equally, certain activities cannot be performed without securing the property first. Clients may book a consultation at motaded.com.sa/services/consultation-services.

Official References

This guide draws exclusively on official Saudi government sources, without any secondary or intermediary source:

▸  Real Estate General Authority — rega.gov.sa: text of the Foreign Real Estate Ownership Law and the program page.

▸  Saudi Properties Portal — saudiproperties.rega.gov.sa: the official platform for Law implementation.

▸  Ministry of Justice — laws.moj.gov.sa: Legal Portal, full Law text.

▸  Bureau of Experts at the Council of Ministers — laws.boe.gov.sa: Official Gazette and statutory issuances.

▸  National Competitiveness Center — istitlaa.ncc.gov.sa: Implementing Regulations draft public consultation.

▸  Ministry of Investment — misa.gov.sa: foreign company registration requirements.

▸  Saudi Press Agency — spa.gov.sa: Council of Ministers decisions.

motaded.com.sa  | Commercial Registration 7009358164