Saudi Gazette report
RIYADH — Saudi Arabia has introduced sweeping new regulations for Riyadh’s rental market, freezing rent increases for both residential and commercial properties for the next five years.
The decision, approved by the Council of Ministers and enacted through a royal decree on September 25, 2025, is designed to stabilize housing costs, protect tenants from sharp price hikes, and ensure fairness between landlords and renters.
The move comes after years of rising rental prices in the capital, which outpaced average household income and created what Crown Prince Mohammed bin Salman described as “unacceptable levels” of housing costs.
Authorities say the rent freeze is part of a broader real estate balance program aimed at reducing housing burdens, restoring market equilibrium, and promoting long-term investment in development projects.
* Five-year rent freeze in Riyadh: Landlords cannot increase the total rental value of existing or new contracts within the city’s urban boundary until 2030.
* Vacant units: If a property has been rented before, its rent must match the last registered lease value.
* New units: Properties being rented for the first time can have their rental value set freely between landlord and tenant.
* Automatic contract renewal: Across all Saudi cities, lease agreements will automatically renew unless one party notifies the other at least 60 days before expiration. In Riyadh, landlords can only refuse renewal in limited cases: tenant non-payment, certified structural defects, or the landlord’s personal/family use of the property.
All leases must be registered through the national digital platform Ejar. Both landlords and tenants have the right to initiate contract registration.
Once a contract is entered, the other party has 60 days to raise an objection. Without objection, the contract becomes legally binding.
The unified digital system also ensures rental contracts act as official, enforceable documents, reducing disputes and strengthening transparency.
Landlords may appeal rent values in special cases, such as when major renovations significantly raise property value or when the last registered lease predates 2024. Appeals will be reviewed by the General Real Estate Authority under clear guidelines.
Violators face fines of up to 12 months’ rent and must correct the violation, with compensation for harmed tenants.
Whistleblowers can receive up to 20% of the collected fine if their report leads to a confirmed violation.
The General Real Estate Authority will oversee enforcement, market monitoring, and reporting.
Specialized committees under the Real Estate Brokerage Law will handle disputes and impose fines.
The government also committed to tracking market performance and issuing periodic reports to adjust policies if needed.
* For tenants: The freeze protects households and businesses in Riyadh from sudden, unaffordable rent hikes, ensuring financial stability and security of tenure.
* For landlords: While unable to raise rents arbitrarily, landlords benefit from digital contract enforcement, reduced legal risks, and a clearer regulatory environment.
* For investors: A more stable, transparent rental market boosts investor confidence and supports Saudi Arabia’s Vision 2030 goal of building a diversified, sustainable economy.
Officials say the decision is a cornerstone of Saudi Arabia’s real estate reforms.
Combined with initiatives such as revising the white land tax system, providing thousands of new residential plots in Riyadh, and expanding Ejar’s digital services, the rent freeze is expected to restore balance in supply and demand.
The government hopes this will make housing more affordable while keeping the market attractive for long-term investment.
