For two decades, overseas Muslims who wanted a home near the Haram had few legal routes and a lot of grey ones. The Real Estate Ownership by Non-Saudis Law, in force since January 2026, replaced that with a framework. It is narrower than headlines suggest, and wider than the old rules.
What the law does
Royal Decree M/14 of July 2025 replaced the 2000 law. Since January 2026, non-Saudi individuals, companies and funds may own real estate within designated geographic zones, with the Executive Regulations and the Geographic Zones approved on 23 June 2026, for residential, commercial or operational use. Outside those zones, foreign residents may own one residential property in limited cases, with safeguards against speculative holding.
The holy cities are treated separately. In Makkah and Madinah, ownership is open to non-Saudi Muslims inside 11 and 10 Cabinet-designated zones respectively. It is not open to all foreign buyers, and the resident's right to one home outside the zones does not apply in the holy cities. Each zone also sets whether the right is full ownership or a usufruct, so a brochure's "freehold" is a claim to test unit by unit.
Three positions, three routes
In practice, overseas buyers arrive in one of three positions. Which one you are in determines what we can show you.
- Living outside the Kingdom. The usual route is Premium Residency through the Real Estate Owner category, which requires qualifying property ownership (the threshold has been SAR 4 million, with an off-plan category added in 2026). Residency and ownership are structured together.
- Resident in the Kingdom on an Iqama. Designated-zone ownership is available; the holy cities depend on the conditions and your status. The property's zone classification is the first thing we check.
- Already a Premium Residency holder. The widest route. The work is product selection and verification, not eligibility.
The product matters as much as the law
Around the Grand Mosque most international access runs through hospitality-led products: titled hotel residences or serviced units under an operator. The quality of that operator, the owner-use days and the revenue share do more for your return than the floor number. In Madinah, the market is broader — serviced residences, villa districts and plots in planned developments — but the distance-to-Haram premium is steep and must be underwritten with real occupancy data.
What to do before you reserve anything
- Confirm your position and the route in writing — not from a sales agent, from someone who will still be around at handover. Non-residents also need a Saudi digital ID issued via an embassy or consulate, a Saudi bank account and a Saudi mobile number.
- Check the property's zone classification and the developer's licence and escrow.
- Read the operator agreement if it is a hospitality product: fees, owner-use days, revenue share and exit.
- Budget about 7% on top of the price: 5% Real Estate Transaction Tax plus the 2% REGA fee on non-Saudi transactions, before broker and registry costs.
- Decide the exit before the entry. Who buys this from you, and when?
Rules change by regulation, not only by law. Treat this article as orientation, confirm your case with us, and confirm the legal position with Saudi counsel before you commit.
By Faheem Iftikhar Siddiqui, Principal Consultant & CEO, Royal Prince Real Estate. General information, not legal or investment advice.
