Saudi Crown Prince Directs Measures to Balance Real Estate Sector in Riyadh
Initiatives to Address Rising Land Prices and Rent in Saudi Arabia's Capital
Crown Prince Mohammed bin Salman, who also serves as the Prime Minister of Saudi Arabia, has directed the implementation of measures aimed at achieving balance within the real estate sector of Riyadh, specifically addressing the increasing prices of land and rental rates.
This directive follows the approval from the Royal Commission for Riyadh City and was initiated to alleviate the economic pressures on residents, reinforcing Riyadh's position as a leading global capital for living and working.
The Crown Prince’s directives reinforce the government’s commitment to providing effective and rapid solutions tackling challenges in both the residential and commercial real estate markets, aiming for market stability which will benefit individuals and the private sector while supporting the goals of the Saudi Vision 2030 initiative to ensure affordable and sustainable housing.
The decision comes as part of broader efforts to shield the market from detrimental practices and to ensure a suitable residential environment for citizens alongside fostering commercial investment, in line with aspirations to position Riyadh among the largest city economies worldwide.
In a detailed response to the rising land prices and rents witnessed over recent years, the Crown Prince mandated several key actions based on studies conducted by the Royal Commission for Riyadh City and the Economic and Development Affairs Council.
These include the lifting of suspensions on transactions such as buying, selling, division, and subdivision of land in the northern regions of Riyadh, which are bordered to the west by King Khalid Road and the extension of Prince Mohammed bin Saad bin Abdulaziz Road, to the south by Prince Saud bin Abdullah bin Jilawi Road, to the north by Asmaa bint Malik Street, and to the east by the Al-Ared neighborhood, covering an area of 17 square kilometers.
Additionally, land to the north of King Salman Road, bordered by Abu Bakr Al-Siddiq Road and the Al-Ared neighborhood, encompasses a further 16.2 square kilometers.
This is alongside two previously lifted suspensions totaling 48.28 square kilometers, bringing the overall area from which suspensions have been lifted in Riyadh to 81.48 square kilometers.
The Royal Commission for Riyadh City is also tasked with releasing between 10,000 and 40,000 plotted and developed residential lands annually over the next five years, responsive to market demand.
These plots are to be priced at a maximum of 1,500 Saudi Riyals per square meter, specifically designated for married citizens or those over the age of 25 who do not currently own other real estate, subject to conditions including a prohibition on selling, leasing, or mortgaging these plots for a decade, except to finance construction on the land.
Furthermore, urgent regulatory measures are to be initiated to update the proposed amendments to the White Land Tax Law within sixty days, aimed at increasing property supply.
Another directive involves establishing legal frameworks within a 90-day period to regulate the relationship between landlords and tenants, ensuring a balance of interests for both parties.
The General Authority for Real Estate and the Royal Commission for Riyadh are instructed to monitor and report on property prices in the capital periodically.
The study of the rental relationship is anticipated to stabilize the rental market, ensuring that the growth in the supply of properties aligns with the demand, subsequently enhancing the affordability and investment appeal in Saudi Arabia through safeguarding the rights of all involved parties.
The proposed amendments to the White Land Tax Law align with the government's broader objectives of stimulating land development, increasing real estate supply, combating market monopolies, and facilitating home ownership among citizens to improve their quality of life.
The initiative to monitor real estate prices reflects the leadership's commitment to elevating transparency and enabling citizens and investors to make informed decisions in the property market, which is expected to contribute positively to the Saudi economy by fostering a more stable and sustainable property sector.
This directive follows the approval from the Royal Commission for Riyadh City and was initiated to alleviate the economic pressures on residents, reinforcing Riyadh's position as a leading global capital for living and working.
The Crown Prince’s directives reinforce the government’s commitment to providing effective and rapid solutions tackling challenges in both the residential and commercial real estate markets, aiming for market stability which will benefit individuals and the private sector while supporting the goals of the Saudi Vision 2030 initiative to ensure affordable and sustainable housing.
The decision comes as part of broader efforts to shield the market from detrimental practices and to ensure a suitable residential environment for citizens alongside fostering commercial investment, in line with aspirations to position Riyadh among the largest city economies worldwide.
In a detailed response to the rising land prices and rents witnessed over recent years, the Crown Prince mandated several key actions based on studies conducted by the Royal Commission for Riyadh City and the Economic and Development Affairs Council.
These include the lifting of suspensions on transactions such as buying, selling, division, and subdivision of land in the northern regions of Riyadh, which are bordered to the west by King Khalid Road and the extension of Prince Mohammed bin Saad bin Abdulaziz Road, to the south by Prince Saud bin Abdullah bin Jilawi Road, to the north by Asmaa bint Malik Street, and to the east by the Al-Ared neighborhood, covering an area of 17 square kilometers.
Additionally, land to the north of King Salman Road, bordered by Abu Bakr Al-Siddiq Road and the Al-Ared neighborhood, encompasses a further 16.2 square kilometers.
This is alongside two previously lifted suspensions totaling 48.28 square kilometers, bringing the overall area from which suspensions have been lifted in Riyadh to 81.48 square kilometers.
The Royal Commission for Riyadh City is also tasked with releasing between 10,000 and 40,000 plotted and developed residential lands annually over the next five years, responsive to market demand.
These plots are to be priced at a maximum of 1,500 Saudi Riyals per square meter, specifically designated for married citizens or those over the age of 25 who do not currently own other real estate, subject to conditions including a prohibition on selling, leasing, or mortgaging these plots for a decade, except to finance construction on the land.
Furthermore, urgent regulatory measures are to be initiated to update the proposed amendments to the White Land Tax Law within sixty days, aimed at increasing property supply.
Another directive involves establishing legal frameworks within a 90-day period to regulate the relationship between landlords and tenants, ensuring a balance of interests for both parties.
The General Authority for Real Estate and the Royal Commission for Riyadh are instructed to monitor and report on property prices in the capital periodically.
The study of the rental relationship is anticipated to stabilize the rental market, ensuring that the growth in the supply of properties aligns with the demand, subsequently enhancing the affordability and investment appeal in Saudi Arabia through safeguarding the rights of all involved parties.
The proposed amendments to the White Land Tax Law align with the government's broader objectives of stimulating land development, increasing real estate supply, combating market monopolies, and facilitating home ownership among citizens to improve their quality of life.
The initiative to monitor real estate prices reflects the leadership's commitment to elevating transparency and enabling citizens and investors to make informed decisions in the property market, which is expected to contribute positively to the Saudi economy by fostering a more stable and sustainable property sector.
