(Bloomberg) — Saudi Arabia said it’s progressing as planned with reforms that will allow foreigners to own a wide range of real estate — including in the holy cities — starting in January.
Non-Saudis will be able to buy residential, commercial, agricultural and industrial properties, in addition to acquiring land to develop, according to a senior official at the Real Estate General Authority.
Designated zones for foreign ownership in Riyadh, Jeddah, and the holy cities of Mecca and Madinah are still under review and will be published “very soon” along with regulations for the new real estate ownership rules, said Fahad BinSulaiman, executive director for non-Saudi real estate ownership at the regulator.
Those zones are set to to be “very wide” and include so-called mega projects, he said. The proportion of non-Saudi ownership in these areas is expected to be capped at 70%-90%.
BinSulaiman said buyers must be Muslim to purchase in the two holy cities but they will face no major restrictions otherwise.
“There are not big conditions. We don’t want to restrict,” BinSulaiman said in an interview at Cityscape Global on Wednesday in Riyadh. “If you are to compare the current law and the updated law, it’s a significant difference.”
The comments from the regulator, known as REGA, confirm previously floated timelines and clarify some details ahead of the release of official regulations. Those rules are currently in the finalization and approval stage, REGA said.
Saudi Arabia approved an overhaul of its property ownership law in July as part of a push to draw foreign investment and advance the Vision 2030 diversification agenda. The real estate market has become a focal point this year as a property crunch exacerbates challenges in luring companies, talent and investment to Riyadh.
Regulators are also loosening restrictions in capital markets and expect to allow majority foreign ownership of Saudi stocks soon.
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REGA launched a portal called Saudi Properties this week to facilitate purchases. It will soon list eligible assets and the geographic zones where foreigners can buy properties.
The zones are being structured to minimize investment risk and ensure balance in the overall real estate market, according to BinSulaiman.
“Our main purpose is to fully open the market, to enable the foreigner to visit Saudi, to buy and to supply real estate,” he said.
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