Riyadh freezes rent hikes for 5 years under new regulations

In a major move to stabilize the rental market, Saudi Arabia has announced a five-year freeze on rent increases for residential and commercial properties in Riyadh.

The directive, issued by Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince and Prime Minister of Saudi Arabia, and approved by royal decree, aims to curb rising rental prices and protect the rights of tenants and landlords.

Effective immediately, no annual increases in rental prices will be allowed on new or existing contracts within Riyadh’s urban boundaries.

The Real Estate General Authority says this landmark reform is designed to bring fairness, transparency and balance to the rental sector.

The authority will be monitoring the situation closely and may extend the rule to other parts of the Kingdom if needed.

Under the new rules:

• For vacant residential and commercial units, the rent must match the value of the last registered contract on the 'Ejar' platform — a government-approved leasing system.
• Also starting today, all lease contracts must be registered on the Ejar network. Both landlords and tenants have the right to initiate registration, and disputes must be raised within 60 days.
• In addition, rental contracts will now automatically renew (all cities in the Kingdom), unless either party gives 60 days' notice. However, landlords in Riyadh can only refuse to renew in specific cases, such as non-payment, safety concerns, or personal use of the property.
• The new regulations also introduce strict penalties for violations, including fines of up to 12 months’ rent and possible financial rewards for whistleblowers who report violations.