UAE Expats Can Now Buy Property in Saudi Arabia Under Landmark 2026 Law

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UAE expats can now buy Saudi property under new 2026 law. Designated zones include Riyadh, Jeddah. Major Gulf real estate shift begins.

Saudi Arabia's new foreign property ownership law came into force on 21 January 2026, opening the Kingdom's real estate market to UAE citizens and expatriates for the first time. The legislation, published under Royal Decree No. M/14, replaces rules dating back to 2000 and represents what analysts are calling a seismic shift in Gulf real estate investment.

The law allows foreign individuals and companies to acquire freehold property, long-term leaseholds, and usufruct rights in designated zones. Riyadh and Jeddah are confirmed as the first phase of approved locations, with additional cities expected to follow throughout 2026 once the Real Estate General Authority (REGA) finalises geographic boundaries.

Who Can Buy Property

The new framework establishes clear eligibility categories for foreign buyers. Resident non-Saudis holding a valid iqama may purchase one residential property for personal use outside designated zones, plus additional properties within approved areas. Non-residents are limited to purchasing within designated zones only.

Foreign companies, investment funds, and Saudi entities with foreign shareholders are also eligible. Listed companies fall under Capital Market Authority regulations. Diplomatic missions and non-profit organisations are explicitly included in the framework.

A key restriction applies to Makkah and Madinah, where residential property ownership is limited to Muslim buyers only. However, foreign-owned Saudi businesses may acquire limited commercial property in these cities for approved purposes such as offices or staff housing.

Where Foreign Buyers Can Purchase

REGA is tasked with defining specific geographic zones, maximum ownership percentages per area, and allowable property types. The first phase explicitly references Riyadh and Jeddah, with officials still reviewing which specific districts will be accessible to foreign purchasers.

Expected high-growth zones likely to be included are:

NEOM – the USD 500 billion smart city development
Red Sea Project – luxury coastal tourism zone
AlUla – cultural heritage and eco-tourism hub
Qiddiya – entertainment and sports development
Eastern Province – particularly Dammam and Khobar

Commercial, industrial, and agricultural property is fully open across all Saudi cities without exception, including the four major metropolitan areas. This reflects the Kingdom's intent to encourage foreign investment in non-residential sectors.

Tax and Cost Implications

Foreign buyers face a higher tax burden than Saudi nationals. The standard Real Estate Transaction Tax (RETT) of 5% applies to all property transfers. Non-Saudi purchasers face an additional foreign ownership fee of up to 5%, bringing the potential total to 10% of property value.

Industry sources advise budgeting for total transaction costs of 12-15% above the purchase price, including registration fees (2.5-5%), agent commissions (2-5%), legal fees, and document attestation. Violations of ownership rules carry penalties of up to SAR 10 million and compulsory sale of the property.

What UAE Buyers Should Know

Zacky Sajjad, Director at Cavendish Maxwell, told Gulf News that the Saudi market remains in a "price discovery and regulatory bedding-in phase" compared with the UAE's mature investment environment. He advised UAE buyers to approach Saudi Arabia as a long-term strategic opportunity rather than a short-term trading market.

Key due diligence steps include verifying whether a property sits within an approved ownership zone, reviewing resale and leasing rules, and taking professional advice on taxation and registration. Mortgage availability for foreign buyers is still developing, which may affect financing options.

The registration process typically takes one to three months and involves multiple approvals from REGA and the Ministry of Interior. Ownership is only legally recognised once recorded with the Real Estate Registry.

Market Outlook

The reform aligns with Vision 2030's target of attracting USD 100 billion in annual foreign direct investment by 2030. Saudi Arabia's real estate market is projected to reach USD 2.47 trillion by 2029, supported by mega-projects, population growth in major cities, and preparation for Expo 2030 and the FIFA World Cup 2034.

Dubai currently offers higher rental yields (6-10% versus 5-8% in prime Riyadh areas) and a more transparent transaction process. However, Saudi Arabia presents lower entry points and potential for long-term capital growth as the market matures. Sean Heckford of Cavendish Maxwell noted that opening prime locations to foreign ownership will increase demand and price premiums, particularly in luxury segments.