Foreigners can buy residences in Saudi Arabia from 2026

Foreign individuals and entities can own and invest in real estate across designated zones in Saudi Arabia from January 2026, following approval of the new Law of Real Estate Ownership and Investment by Non-Saudis by the Council of Ministers on the 8^th July 2025.

Replacing the more restrictive 2000 framework of Royal Decree No M/15, the new law opens access to real estate foreign ownership in areas to be designated by the General Real Estate Authority – which will initially focus on high-demand commercial and residential markets.

Prior approval for real estate purchases will still apply, together with the imposition of certain conditions – for both commercial and residential properties. Foreign ownership remains prohibited in certain locations like Mecca and Medina.

According to the full text published on the 25^th July 2025 in the official gazette Umm Al-Qura, foreign individuals may own a residential property outside restricted areas for own personal housing. Diplomatic missions and international organizations can also own premises for official use and residence of their representatives, subject to Foreign Ministry approval and reciprocity conditions.

All such purchases need to be formally recorded in the national real estate registry – after payment of a new real estate transfer fee of up to 5% for transactions involving non-Saudis. Violations will attract fines up to SAR10 million (US$2.67 million) and possibly forced sales.

Previously, foreign ownership was obtained through the Premium Residency program with a minimum SAR4 million (US$1.07 million) investment and needing a local sponsor. The new law would mean affordable properties will become accessible to foreigners, not just luxury units. However, foreign individuals can still own only one residential property at a time.

Also, property ownership – allowed only with valid residency permit (Iqama) – does not automatically confer residency for foreigners in Saudi Arabia. That privilege will require higher investment amounts or special status, noted Naveen Sharma, chairman of the UAE Taxation Society.

For corporate ownership, the law allows non-listed companies with foreign shareholders, as well as licensed investment funds and SPVs, to own real estate.

Foreign entities may acquire full ownership of commercial real estate investments if the investment is development-focused, the project meets a minimum capital threshold currently set at SAR30 million (US$8 million) and is operationally completed within five years.

“These provisions aim to ensure that foreign investment actively contributes to urban growth and market liquidity, rather than serving speculative purposes,” stated US-based law firm Greenberg Traurig.

Implementing a 180-day phase-in period allows authorities to continuously assess the law’s impact on local real estate prices and supply dynamics while ensuring housing access and affordability for Saudi nationals, it added.

“This reform could become a cornerstone of Saudi Arabia’s broader strategy to position itself as a global hub for investment and sustainable urban development.”