JEDDAH: Saudi Arabia has issued a detailed procedural guide to implement its previously approved off-plan real estate regulation, aiming to enhance transparency, protect buyers, and formalize developer obligations.
The new framework was formally approved by Real Estate General Authority CEO Abdullah bin Saud Al-Hammad on May 2 and took effect immediately, according to the official gazette Umm Al-Qura.
This guide is part of the regulatory rollout following the Cabinet’s 2023 decision to formalize off-plan real estate sales and leasing. It is designed to strengthen investor confidence in a sector that accounts for approximately 7 percent of Saudi Arabia’s gross domestic product and plays a crucial role in supporting related industries such as construction and finance.
In a post on its official X handle, REGA stated: “The Real Estate Authority issued the procedural guide for the sale and rent of real estate projects off-plan, with the aim of clarifying the requirements of the procedures that regulate and control the stages of licensing, marketing, selling, leasing, and managing real estate projects off-plan, including requests for amendments or changes, opening and managing an escrow account, and other regulatory procedures.”
The updated model outlines 55 defined scenarios, covering applications by legal and individual developers to register or update their status, improve evaluation scores, or request project modifications. It also details processes for certifying completion, changing contractors, switching project banks, and reallocating escrowed funds.
Refunds to buyers from escrow accounts are permitted in cases such as the cancellation of marketing permits, project delays exceeding 180 days, or failure to secure a sales license. The guide also addresses scenarios involving project restructuring, title transfers, license revocations, and developer substitutions for delayed projects.
The reforms are intended to provide legal clarity and investor assurance as off-plan development becomes an increasingly prominent feature of the Kingdom’s residential and commercial real estate landscape.
Legal entities and individuals seeking to develop off-plan properties must now comply with strict registration and reporting requirements, including updates to developer evaluations and the appointment of certified consultants and accountants.
The regulatory update underscores Saudi Arabia’s push to build a robust legal infrastructure for its real estate sector, positioning the Kingdom as a competitive and secure environment for local and foreign investors.
