Saudi Arabia Opens Real Estate Market to Foreign Investors, Excluding Mecca and Medina
The Saudi Arabian government has approved a new law allowing foreign citizens and companies to purchase property in the country, effective from January 2026. The move aims to reduce oil dependence and boost the real estate market, with specific restrictions in place for Mecca and Medina.
Real EstateForeign InvestmentSaudi ArabiaVision 2030NeomReal Estate NewsJul 30, 2025
Housing Minister Majid bin Abdullah described the development as the 'next step in real estate reforms,' stating that the new regulations will boost foreign investment and transform Saudi cities like Riyadh and Jeddah into global investor hubs.
Key Highlights of the New Law:
- Foreign investors will be allowed to buy property in cities such as Riyadh, Jeddah, and other designated areas.
- The Real Estate General Authority will release a list of permissible locations and rules for foreign ownership within 180 days.
- Investors can acquire up to 49% shares in real estate firms listed on the Saudi Stock Exchange (Tadawul) involved in property development in restricted zones.
Despite the new policy, restrictions will remain in place for Mecca and Medina due to their religious and cultural significance. Property ownership in these holy cities will be permitted only to Muslims under specific conditions. The law is also expected to support Saudi Arabia’s goal of generating $30 billion through religious tourism by 2030, especially from pilgrimages such as Hajj and Umrah.
The reform is a crucial component of Vision 2030, an ambitious economic and social transformation agenda spearheaded by Crown Prince Mohammed bin Salman. Launched in 2016, the initiative aims to reduce Saudi Arabia’s dependence on oil and diversify its economy. One of the flagship projects under Vision 2030 is NEOM, a futuristic smart city being built in the northwestern desert. A major highlight of this development is 'The Line', a car-free urban belt that will be 200 meters wide, 170 kilometers long, and powered entirely by renewable energy.
According to reports, only 2.4 kilometers of The Line is expected to be completed by 2030, but the government has allocated a massive ₹40 lakh crore for the entire NEOM project, marking it as one of the most ambitious infrastructure ventures globally.
Frequently Asked Questions
When will the new law allowing foreign property investment in Saudi Arabia come into effect?
The new law will come into effect from January 2026.
Which cities will be open for foreign property investment under the new law?
Foreign investors will be allowed to buy property in cities such as Riyadh, Jeddah, and other designated areas.
What are the restrictions for property ownership in Mecca and Medina?
Property ownership in Mecca and Medina will be permitted only to Muslims under specific conditions due to their religious and cultural significance.
How does the new law support Saudi Arabia's Vision 2030 goals?
The new law aims to reduce Saudi Arabia's dependence on oil and diversify its economy by boosting foreign investment in the real estate market.
What is NEOM, and what is 'The Line'?
NEOM is a futuristic smart city being built in the northwestern desert of Saudi Arabia. 'The Line' is a car-free urban belt that will be 200 meters wide, 170 kilometers long, and powered entirely by renewable energy.
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