For years, the relationship between landlords and tenants has been a hot topic in the Saudi real estate market, with much controversy and escalating disputes. Today, with the approval and implementation of the Crown Prince's directive, the General Authority for Real Estate announced the regulatory provisions for controlling the rental relationship, opening a new page of justice and clarity between the two parties
These rulings had a clear reformist character: they do not favor one side over the other, but rather set rules that regulate the market and give it the stability that everyone needs
In Riyadh, rental values will be fixed starting September 25, 2025, for a period of five years, with no rent increases during this time. If the property has never been rented before, the rent will be determined by agreement between the landlord and the new tenant. The regulations also stipulate that landlords cannot refuse to renew the lease except in specific and clearly defined cases, such as the tenant's failure to pay rent, the presence of structural defects in the property, or the landlord's desire to use the property for themselves or a first-degree relative
In the rest of the Kingdom, it has been decided that contracts will be automatically renewed unless one party notifies the other sixty days prior to their expiration. Rent remains subject to agreement between the landlord and tenant, with the possibility of increasing or decreasing it by mutual consent, without the same restrictions as those in place in Riyadh
Over the past years, uncontrolled rental costs have put significant pressure on commercial tenants, leading to the exit of a number of businesses and shops from the market, which has negatively impacted economic activity. Today, with these new regulations, it can be said that the real estate market is moving towards a more organized phase, providing stability for tenants and establishing a clear legal framework for landlords
The decision, as it was issued in implementation of the directive of His Highness the Crown Prince, not only reflects the importance of the real estate file, but also confirms that it is an integral part of the project to improve the quality of life in the Kingdom, and to ensure a more just and balanced economic environment
