Buying property in Makkah and Madinah: who can own and how the purchase works

Who can own property in Makkah and Madinah

The rules come from the Law of Real Estate Ownership and Investment by Non-Saudis, which took effect on 22 January 2026 and replaced the 2000 law. Articles written before 2026 therefore describe a regime that no longer applies. For individuals, the law sets two conditions in the holy cities:

• a non-Saudi natural person may own property in Makkah and Madinah only if Muslim (Art. 2(4)), whether resident in the Kingdom or living abroad;
• ownership is allowed only within zones designated by the Council of Ministers.

The separate rule that lets a legal resident own one home outside the designated zones expressly excludes these two cities (Art. 2(3)), so an iqama does not open up purchases outside a zone, and a non-Muslim individual cannot buy there under any status.

Companies follow a separate regime. Unlisted Saudi companies with foreign shareholding may own property in Makkah and Madinah (Art. 3), as may companies listed on the Saudi stock exchange, licensed investment funds and special purpose entities, under the Capital Market Law and the rules of the Capital Market Authority, CMA (Art. 4).

Ask a Saudi lawyer how the buyer's faith is to be evidenced before you reserve, not after you pay. If you plan to buy through a company, settle the structure with a lawyer before choosing a property: Articles 3 and 4 of the law and the CMA rules determine which vehicles qualify.

Approved zones: checking a plot near the Haram

The zones for Riyadh, Jeddah, Makkah and Madinah are set out in the Geographical Zones Document. According to Deloitte and Greenberg Traurig, the Council of Ministers approved the Implementing Regulations and the zones on 23 June 2026, and they were formally published on 3 July 2026. The Real Estate General Authority (REGA) publishes the zone map on the Saudi Properties portal.

For each zone, the map shows the permitted types of right (for example ownership or usufruct), the maximum foreign-ownership percentage and any grace periods. What matters is the specific plot, not the city name or the walking distance to the mosque. Being near Al-Masjid Al-Haram does not make a plot eligible. Before reserving, ask for:

• the exact address and plot details of the building;
• confirmation that the plot lies within an approved Makkah or Madinah zone, and which right a foreign buyer can hold there;
• for an off-plan project, its Wafi licence number;
• a draft contract stating who pays the tax and fees.

Buying as a non-resident: step by step

There is no single official checklist. The order below combines REGA guidance with advisers' summaries of the Implementing Regulations; an individual transaction may involve further steps.

1. Check the plot on the Saudi Properties zone map and confirm that you meet the Makkah and Madinah rule: a Muslim individual.
2. Obtain a digital identity. REGA says that for non-residents the process starts at Saudi missions and embassies abroad; residents apply with their iqama number.
3. Open a Saudi bank account and get a Saudi mobile number, as Deloitte and Greenberg Traurig describe the requirements of the Implementing Regulations. Press reports say that in July 2026 SAMA instructed banks to open such accounts, usable only for property transactions, with no debit or credit cards, no joint accounts and no authorised representatives abroad.
4. Apply for ownership on the Saudi Properties portal (saudiproperties.rega.gov.sa); according to a REGA press release, it began accepting applications on 23 June 2026.
5. For an off-plan unit, check the project licence on Wafi and make sure the contract directs your payments to that project's escrow account.
6. Sign the contract and pay only electronically to the account named in it; according to consultants, the regulations route payments through SAMA payment systems.
7. Register the right with the Real Estate Registry.

When does ownership begin?

The law is explicit: a non-Saudi's ownership is valid upon registration with the Real Estate Registry (Art. 8). Reservation, a signed contract and even full payment are stages of the deal, not the moment the right arises. According to consultants, applications, payments and title issuance run through a single REGA platform linked to the registry.

For an off-plan purchase, ZATCA's detailed guideline on the Real Estate Transaction Tax says the tax is due on or before notarisation of the transfer; check the contract for when that happens.

Owning property does not grant residency: under the law it confers no rights beyond those of the holder of a right in rem. Premium Residency for property owners is a separate regime with its own law and its own application; the Premium Residency Center lists, among other conditions, a property value of at least SAR 4,000,000 with no mortgage, and states that conditions are subject to change.

Buying costs beyond the price: RETT and the REGA fee

• Real Estate Transaction Tax (RETT): 5% of the price of each transaction, whatever the property's condition or use. The seller is liable by default, but the buyer becomes jointly liable if they cause non-payment, underpayment or late payment. The first-home RETT relief applies to Saudi citizens only.
• REGA fee for non-Saudis: the law allows a fee of up to 5% of the transaction value in addition to other taxes and fees (Art. 9). According to consultants, the Implementing Regulations set it at 2% in Makkah, Madinah, Riyadh and Jeddah Governorate. Agree in the contract who pays it and confirm with a lawyer.
• VAT: since 4 October 2020, sales of real estate in Saudi Arabia have been exempt from VAT and subject to RETT instead. Related services such as brokerage, management or furniture should be checked separately.
• Intermediaries: if a broker is involved, the commission and the party paying it are set out in a written agreement.

For scale: on a price of SAR 2,000,000, RETT is SAR 100,000 (owed by the seller by default) and a 2% REGA fee is SAR 40,000. The final budget depends on the contract and needs working out for each deal. Rental income may be taxable in your country of tax residence, and its treatment in Saudi Arabia should be confirmed with a tax adviser.

Off-plan homes and Wafi escrow: what it does and does not do

Off-plan sales are governed by the Off-Plan Sale and Lease Law, in force since 4 April 2024 and supervised by REGA through the Wafi platform. The main rules under the regulations and Wafi's requirements:

• each project has its own SAR escrow account at a licensed bank, and all buyer payments go into it;
• the developer draws on the account through requests approved by the engineering consultant and the chartered accountant;
• reservations under a marketing licence are capped at 5% of the unit value;
• construction must start within 6 months of licensing;
• the handover date is fixed to the day in the contract, and developer-caused delay requires compensation of at least the fair market rent for the unit;
• REGA may appoint a replacement developer.

Mortgages: what to expect

Plan to buy with your own funds. We found no official rule guaranteeing mortgages to non-Saudis; each bank decides for itself. The SAMA rulebook reportedly restricts real estate financing in Makkah and Madinah to Saudi nationals. That provision may be outdated, so confirm the current position with a bank before reserving.

A developer's payment plan is a term of the sale contract, not a loan, and deserves the same scrutiny as every other clause: amounts, dates, penalties and termination.

Pilgrim numbers and rental income: what the figures do not say

Pilgrim traffic is often cited as a reason to buy in Makkah. The official figures:

• in 2025 Saudi Arabia received 19.5 million pilgrims from abroad for Hajj and Umrah combined (Pilgrim Experience Program, Adaa);
• the 1446H Hajj in 2025 was performed by 1,673,230 pilgrims, of whom 1,506,576 came from abroad (GASTAT).

Separate from these statistics is a target: the Vision 2030 Pilgrim Experience Program is expanding capacity to accommodate up to 30 million pilgrims by 2030.

These figures describe scale and a capacity target. They are not a forecast of demand for any apartment, its occupancy, its rent or its price. Rental income is possible but never guaranteed, and the owner bears the risk, including vacancy and management costs. Before counting on letting, check the permitted rental use, the management terms and the full cost of ownership.

Penalties for false information and common mistakes

Breaches of the law carry a warning or a fine of up to 5% of the value of the right, capped at SAR 10 million. A non-Saudi who deliberately gives false or misleading information to acquire property faces a fine and a court-ordered sale of the right. Deliberately misstating information about the buyer, faith included, to acquire property therefore puts the property itself at risk.

Common mistakes to avoid:

• judging eligibility by the city name or the words 'near the Haram' instead of the zone map;
• paying before the zone, the type of right and the Wafi licence have been checked;
• treating payment or the contract, rather than registration, as the start of ownership;
• budgeting for 5% RETT and forgetting the REGA fee (2%, according to consultants);
• trusting promises of 'guaranteed rental income from pilgrims': no one can guarantee occupancy or rent, and an IslamWeb fatwa (No. 237331) classes a promised fixed return on investment as riba;
• expecting the purchase to bring residency.

Frequently asked questions