Saudi Arabia’s Cabinet, chaired by King Salman bin Abdulaziz, recently approved the geographic zones where non-Saudis will be permitted to own real estate. The decision, announced through the Real Estate General Authority, gives concrete shape to the Law of Real Estate Ownership by Non-Saudis, which entered into force in January but had left the actual boundaries of foreign ownership undefined until now.
Commerce Minister Majid Al-Qasabi called the regulations “a strong catalyst for companies to expand their businesses and enhance competitiveness” in a post on X.
Investment Minister Fahd bin Abduljalil Al-Seif framed the zones as a mechanism for regulatory certainty: they define ownership boundaries, property rights, obligations, and pathways for use, which he said gives foreign firms a structured basis for headquarters and long-term investment decisions.
Where Foreigners Can Now Buy in Saudi
The approved zones concentrate around Saudi Arabia’s highest-profile developments rather than opening entire cities.
In Riyadh, they include Qiddiya, New Murabba, the Sports Boulevard, the Arts District, Diriyah Gate, King Salman Park, Sidra, the King Abdullah Financial District, and King Salman International Airport.
Jeddah’s zones cover the city center and 55 separate development areas across the governorate.
Makkah and Madinah appear on the list too, but with a restriction: ownership there is limited to Muslims, whether resident in the Kingdom or abroad, alongside licensed Saudi companies and capital markets vehicles. Approved sites there include Abraj Makkah, Jabal Omar, and King Salman Gate in Makkah, and Downtown Madinah and Diyar Al-Maqar in Madinah.
AlUla and the Kingdom’s planned urban mega-projects, including NEOM, Amaala, and the Red Sea project, round out the list.
A Historic Reversal, Executed in Stages
For most of Saudi Arabia’s modern history, foreign real estate ownership was the exception rather than the rule, governed by a 2000 law that handled foreign acquisitions on a case-by-case basis at the regulator’s discretion.
The new law replaces that discretionary system with a zoning-based framework: non-Saudis may own property or in-rem rights only within areas the Council of Ministers designates, with maximum ownership shares and usufruct terms set zone by zone.
The law existed for five months without an operative map. Now it has one, alongside a transfer fee of up to 5% on non-Saudi disposals, layered on top of the existing 5% real estate transfer tax.
Güvenç Ketenci, CEO of Turkish law firm Ketenci & Ketenci, who advises clients on Saudi Arabia’s Premium Residency program, sees the designated-zone approach as a deliberate strategy.
“The current approach is intentionally measured rather than restrictive,” Ketenci told IMI, describing development as “effectively opening the market in phases” so regulators can “monitor transaction volumes, pricing dynamics, compliance standards and foreign participation before considering wider liberalization.”
Ketenci points to precedent elsewhere: “many countries that have successfully attracted foreign real estate investment have followed a similar path: opening selected areas first, evaluating market response, and then expanding gradually if the results are positive.”
Will the Zones Satisfy Foreign Demand?
Whether the selected areas can absorb the foreign demand Saudi Arabia is courting is a separate question from whether the legal framework works. Riyadh and Jeddah, in Ketenci’s view, are the strongest bets as “they combine economic growth, expatriate communities, multinational employers, and large-scale developments in a way few other Saudi cities can match,” he explained.
The inclusion of Mecca and Medina projects could prove quite significant, he added, given how Muslim investors have historically treated ownership in the holy cities as “both a lifestyle and a long-term wealth-preservation decision.”
But he cautions against reading the zone list as the whole story, explaining that buyers today weigh rental demand, liquidity, exit options, developer quality, legal certainty, and financing availability, “not simply being able to purchase property.”
The designated zones, in his words, are “only one part of the equation.”
The Premium Residency Connection
Until now, the primary legal route for a foreigner to own Saudi property outright has run through the Premium Residency program, the Kingdom’s investor residency program launched in 2019, which drew more than 40,000 applications between January 2024 and July 2025 on the back of broadened eligibility criteria.
Ketenci does not expect the new zones to trigger an immediate spike in Premium Residency applications, but he does see them reinforcing a shift already underway.
Property ownership rights, he argued, close a psychological gap that pure residency status does not. “Real estate ownership creates a stronger sense of permanence and commitment, which naturally complements a long-term residency program.”
Positioning Against the Rest of the GCC
Ketenci does not foresee the Kingdom displacing Dubai or other established GCC hubs so much as sitting alongside them. “Saudi Arabia’s advantage lies in the scale of its domestic economy, the government’s long-term Vision 2030 agenda, substantial infrastructure investment, and the level of policy continuity demonstrated over recent years,” he said, calling it “increasingly a complementary destination within broader regional investment strategies” rather than a direct competitor to regional markets.
Legal access to property matters less, in his assessment, than how the system performs once transactions begin: how efficiently deals close, how transparent registration proves to be, how disputes get resolved, and whether the rules apply consistently over time.
Saudi Arabia’s real estate market is on track to grow from about $75 billion in annual transaction value in 2025 to $101.6 billion by 2029, roughly 8% growth a year, according to the Kingdom’s Real Estate General Authority, a trajectory that now, for the first time, has a defined legal map for foreign capital to follow.
