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Expat Exchange - Buying a Home in Saudi Arabia
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Buying a Home in Saudi Arabia

By Betsy Burlingame

Universal Tax Professionals
Universal Tax Professionals

Summary: The one tip that you hear expats living in Saudi Arabia repeatedly sharing with newcomers is not to buy a home when you first move to Saudi Arabia. Rent for a few months or longer so that you have time to find the right neighborhood. Give yourself time to ensure that Saudi Arabia is right for you for the long term. If you've already taken time to do those things and are ready to take the plunge and become a property owner, here are tips about buying a home in Saudi Arabia.

Real Estate Saudi Arabia - Buying a Home in Saudi Arabia

Buying a home in Saudi Arabia as an expat can be a complex process, but with the right information and guidance, it can be a rewarding investment. This guide will provide you with key insights into the Saudi Arabian real estate market, including how to find properties, understanding the legal restrictions and requirements, and navigating the buying process. Whether you're looking to buy a home for personal use or as an investment, this guide will help you make an informed decision.

How do I find houses for sale in Saudi Arabia?

There are several ways to find houses for sale in Saudi Arabia. Online property portals are a popular choice, offering a wide range of listings from across the country. Websites like Propertyfinder.sa, Bayut.sa, and others provide detailed information about available properties, including photos, location details, and price. Real estate agencies are another good source of information, and many have English-speaking agents who can assist expats. Local newspapers also list properties for sale, although these are typically in Arabic.

Are there restrictions on foreigners owning property in Saudi Arabia?

Yes, there are restrictions on foreign ownership of property in Saudi Arabia. Non-Saudi nationals are generally not allowed to own property in the holy cities of Mecca and Medina. However, in 2019, the Saudi government introduced a new law allowing foreign individuals and companies to buy property in other parts of the country for residential, commercial, or industrial purposes. This is part of the country's Vision 2030 initiative to attract foreign investment. It's important to consult with a legal expert to understand the specific rules and regulations.

Does Saudi Arabia have an MLS type system?

Saudi Arabia does not have a Multiple Listing Service (MLS) like in the United States. However, the Saudi Ministry of Housing has a system called "Ejar" which is a national database for rental properties. For buying properties, individuals typically rely on real estate agencies, online portals, and personal connections.

Do brokers have licenses and how do I know if they are licensed?

Yes, real estate brokers in Saudi Arabia are required to be licensed by the Ministry of Commerce and Investment. You can verify a broker's license by asking to see their Brokerage License Card, which should include their name, license number, and expiration date. It's important to only deal with licensed brokers to ensure a legal and transparent transaction.

What documents are required when buying a home?

When buying a home in Saudi Arabia, you will need to provide several documents. These include a valid passport, a Saudi residence permit (Iqama for non-Gulf Cooperation Council nationals), proof of income, and a letter from your employer stating your position and salary. If you're buying property as a company, you'll also need to provide your commercial registration certificate and articles of association.

Do I need a lawyer when buying a home in Saudi Arabia?

While it's not mandatory to have a lawyer when buying property in Saudi Arabia, it's highly recommended. A lawyer can help you understand the legal requirements, review contracts, and ensure a smooth transaction. Legal fees can vary, but you should expect to pay around 1-2% of the property value.

Do people typically buy a property with all cash or take out a mortgage?

Both cash purchases and mortgages are common in Saudi Arabia. The Saudi Arabian Monetary Authority regulates mortgages and has set a maximum loan-to-value ratio of 90% for first-time buyers. This means you'll need to have at least 10% of the property value as a down payment. Interest rates are typically around 3-5%.

Are there inspections that take place, and if so what is that process like?

Yes, property inspections are a standard part of the buying process in Saudi Arabia. A professional inspector will assess the condition of the property, checking for any structural issues, electrical problems, plumbing defects, and so on. The buyer typically pays for the inspection, which can cost between 1,000 and 3,000 SAR.

What are some of the pitfalls to avoid when buying property in Saudi Arabia?

One of the main pitfalls to avoid when buying property in Saudi Arabia is not thoroughly researching the property and the area. Make sure you understand the local market conditions, the property's value, and any potential issues with the property. It's also important to ensure all legal documents are in order and that you're dealing with a reputable, licensed broker. Finally, be aware of the ongoing costs of owning property, such as maintenance fees, utility bills, and property taxes.

Expats Talk about Real Estate in Saudi Arabia

"My advice would be to take it easy - your company should do most of the work although on arrival be ready for an information overload as well as not sleeping very well in the first few weeks and don't worry it takes a few weeks to settle but you will adapt very quickly and get out there ! join every club etc you can ! it is hard to meet people and always remember your manners as it stands to you for the next invite," said one expat living in Riyadh.

About the Author

Betsy Burlingame Betsy Burlingame is the Founder and President of Expat Exchange and is one of the Founders of Digital Nomad Exchange. She launched Expat Exchange in 1997 as her Master's thesis project at NYU. Prior to Expat Exchange, Betsy worked at AT&T in International and Mass Market Marketing. She graduated from Ohio Wesleyan University with a BA in International Business and German.

Some of Betsy's articles include 12 Best Places to Live in Portugal, 7 Best Places to Live in Panama and 12 Things to Know Before Moving to the Dominican Republic. Betsy loves to travel and spend time with her family. Connect with Betsy on LinkedIn.

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