Saudi Arabia has introduced a significant change for foreign investors: the ability to own and sell real estate across the Kingdom, except in Makkah and Madinah. This decision opens the door to investments in residential, industrial, and commercial properties, offering new opportunities for international investors.
With this move, Saudi Arabia aims to further boost its economy and diversify its real estate sector beyond the two sacred cities.
Key Conditions for Foreign Investors: Real Estate Investment Permitted but Not Speculative Activity
The new policy offers foreign investors the chance to purchase various types of real estate, such as personal residences, company offices, industrial facilities, and employee accommodations.
However, the Kingdom has placed clear restrictions. People who acquire properties under this initiative cannot used them for speculative purposes. This means investors cannot buy real estate with the primary goal of flipping it for quick profits.
That’s because the Kingdom is focusing on long-term, sustainable investments that contribute to the growth of the real estate market and the wider economy.
Foreign Investors Are Restricted From Purchasing Property in Makkah & Madinah
While the new rule opens many doors, it also sets geographical boundaries. Foreign investors cannot purchase real estate within the holy cities of Makkah and Madinah.
This restriction ensures that the commercial aspect of real estate development doesn’t compromise the sanctity and special status of these cities.
Instead, Saudi Arabia designed the policy to foster growth in other regions. This allows for the development of residential and commercial spaces that contribute to the Kingdom’s overall expansion while respecting the religious importance of Makkah and Madinah.
Foreign Investors Need to Secure Approval to Purchase Real Estate in Saudi Arabia
Starting with real estate investment in Saudi Arabia is relatively straightforward. Foreign investors must first seek approval from the Ministry of Investment. The process is easy to navigate through the Ministry’s e-services portal, and there are no fees involved.
Typically, investors can expect approval within five business days. The required documents include a building permit or approval letter from the local municipality, along with a statement from an official authority regarding the intended use of the land.
For those planning to develop real estate projects, you must also submit a detailed report from an accredited engineering office showing that the project cost exceeds SR30 million.
The New Policy Boosts Real Estate Investment Beyond the Holy Cities
This initiative forms part of Saudi Arabia’s broader economic strategy to attract foreign capital and diversify its investment landscape.
By allowing foreign ownership of real estate in regions outside Makkah and Madinah, the Kingdom is setting the stage for growth in less-developed areas. This will lead to increased job creation, infrastructure development, and the expansion of the real estate market.
With clear guidelines and a transparent process, foreign investors are encouraged to take part in the Kingdom’s dynamic growth while contributing to regional development.
A Step Toward Greater Economic Diversification
The Ministry of Investment’s new policy is a significant step toward diversifying Saudi Arabia’s economy. By opening up the real estate market to foreign investors, the Kingdom is positioning itself as an attractive destination for international capital. This move will not only benefit the real estate sector but also contribute to broader economic development, making Saudi Arabia a key player in global investment circles!
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