Buying Off-Plan Property in Saudi Arabia: Wafi Licences, Escrow and Developer Checks

Which law governs off-plan sales in Saudi Arabia

Off-plan sales and leases are governed by the Off-Plan Sale and Lease of Real Estate Projects Law, issued under Council of Ministers Resolution No. 196 dated 04/03/1445 AH and in force since 4 April 2024. Its Implementing Regulations set out the detail, and the Real Estate General Authority (REGA) supervises the market through the Wafi platform.

The principle is straightforward: a developer may collect money for something that does not yet exist only under a licence and only through a controlled account. Developer qualification with REGA is a mandatory step before any licence. The project licence itself requires, among other things, a feasibility study, confirmation of the building permit, a minimum evaluation score and an escrow agreement with a licensed bank in the Kingdom.

Before the project licence there may be a marketing licence, valid for up to 180 days. During that window the developer may take reservations of no more than 5% of a unit's value, and those amounts must also be paid into escrow. If the marketing licence expires without a project licence being granted, REGA refunds the escrowed amounts to the people who paid them.

What Wafi is and how to check a developer and project licence

Wafi is REGA's platform for off-plan sales and leases. Developers use it for qualification and licensing; buyers can use its public data. The Wafi page carries two lists. The qualified companies list shows each developer's licence number, city, status and qualification dates. The projects list shows the project name in Arabic (which may differ from the marketing name), the developer, the city, the status and the licence type. Each project's card ('View More') adds the project licence number and validity, the escrow bank and account number, the chartered accountant, the engineering consultant and the completion rate. An inquiry service lets you search licensed projects by area.

The check takes minutes and belongs before any reservation:

1. Ask the seller for the project's Wafi licence number, the developer's full legal name and the project's Arabic name.
2. Find the project in the Wafi projects list, open its card ('View More') and match the licence number and validity, the bank and the escrow account number against the contract.
3. Find the developer in the qualified companies list and check its status and qualification dates.
4. Any payment instructions you receive must match the escrow account in the contract and on the project card; stop at any mismatch.
5. If the marketing name differs from the name in the documents, get written confirmation of which licensed project you are buying into.

How escrow works for off-plan projects in Saudi Arabia

Each project has its own escrow account with a unique reference number at a licensed bank, held in Saudi riyals (SAR). Every amount the developer receives from buyers must be deposited into it.

Withdrawals are allowed only for project purposes and only by cheque or transfer. The developer applies to the bank with approval from the engineering consultant and a chartered accountant stating the amounts and reasons. In cases listed in the regulations REGA itself may authorise withdrawals, including refunds to buyers.

Know the limits. Escrow governs how buyers' money is used and makes it harder to divert. It is not insurance, and it does not promise on-time completion or a refund in every scenario.

What an off-plan sale contract must include

The developer–buyer contract form is part of the licence file. Wafi requires it to set handover dates by day and not to conflict with Sharia principles.

Article 20 of the regulations also has REGA issue a standard sale contract, which the developer may amend only with REGA's approval. The standard contract must cover:

• the payment schedule;
• the consequences of late payment by the buyer;
• compensation and fair market rent if the developer delivers late, and termination provisions;
• the project completion timeline, including any additional extensions that may be granted to the developer;
• joint-ownership provisions under the Law of Ownership, Subdivision and Management of Real Estate Units;
• a clause recognising REGA's right to appoint an alternative developer if the project runs into difficulty (Art. 20(3)).

The REGA standard contract applies to properties not registered under the Real Estate Registration Law; for registered properties the same data is recorded when the transaction is registered.

The regulations do not list specifications as a mandatory contract term, but they oblige the developer to build to the specifications agreed in the contracts and the feasibility study and to give the buyer the actual plans and drawings of the unit (Art. 14). We therefore recommend checking that area, layout, finishes and fittings are written into the contract or an annex.

Cross-check the licence number, the unit reference and the escrow details against the project card on Wafi. If something matters to you and appears only in a brochure or an email, ask for it to be written into the contract or an annex.

Construction start, delays and compensation

Wafi requires the developer to undertake to start construction within six months of the licence date. After that the contract sets the timeline, so read the extension clauses carefully: the regulations allow for additional time to be granted.

If the developer delivers late without a cause beyond its control, it owes the buyer compensation. The parties agree the amount, subject to a floor: for units, fair market rent as determined by an approved valuer; for developed land, 2% of the sale value per year.

For delayed and defaulted projects REGA forms a specialised committee, which may, among other measures, appoint an alternative developer. That is a rescue tool for the regulator to use, not a promise to buyers, and timelines may shift.

Off-plan risks that escrow does not cover

• Delays: compensation softens them but does not give the time back, and extensions may be built into the contract.
• Expectation gaps: a render is not a specification; compare finishes and fittings with the contract annex.
• Eligibility: a Wafi licence confirms the project's status, not that you personally may buy a unit in it; for a foreign buyer that depends on the address, the zone and the buyer's status.
• Payment risk: pay only into the project escrow account named in the contract, never to personal or intermediary accounts.
• Income after handover: if you plan to let the unit, rental income is possible but not guaranteed; demand, rents and management costs are not known in advance.
• Taxes and fees: escrow does not cover them, so budget for them from the start.

Can foreigners buy off-plan property in Saudi Arabia

The Law of Real Estate Ownership and Investment by Non-Saudis has applied since 22 January 2026. Non-Saudis, resident or not, may own property in zones designated by the Council of Ministers; in Riyadh, Jeddah, Makkah and Madinah ownership is allowed only within the zones on the map published on the Saudi Properties portal, so the exact address is what counts. In Makkah and Madinah, individual non-Saudi ownership is limited to Muslims and to designated zones.

Applications go through the Saudi Properties portal, open since 23 June 2026. Non-residents first obtain a digital identity through a Saudi mission abroad; according to legal advisers' summaries of the Implementing Regulations, they also need a Saudi bank account and a Saudi mobile number, and payments must be electronic through SAMA systems.

Title registration, costs and residency

A non-Saudi's ownership exists only once registered with the Real Estate Registry; a reservation, contract or full payment does not replace registration. Where the project land is registered, off-plan contracts are recorded in the Off-Plan Sale Register at the Real Estate Registry.

Factor in the 5% Real Estate Transaction Tax. By law the seller owes it, but the buyer becomes jointly liable if they caused non-payment, underpayment or late payment, so check how the tax is reflected in the price and the contract. For off-plan sales the tax is due on or before notarisation of the transfer.

Advisers' summaries of the Implementing Regulations add a 2% REGA fee for non-Saudis on property in Riyadh, Makkah, Madinah and Jeddah Governorate, charged on top of other taxes and fees. Sources do not specify which party pays it; confirm with a lawyer.

Ownership does not confer residency: under the law, owning property gives no rights beyond those of an owner, residency included. Premium Residency is a separate application with an off-plan category: one unit worth at least SAR 4,000,000, at least SAR 1,000,000 or 10% of the price paid, whichever is higher, a REGA-approved developer, no mortgage and title transfer within five years. The Premium Residency Center states that its conditions may change.

Off-plan buying checklist and projects in our catalogue

1. Check the address on the Saudi Properties zone map and your own eligibility; in Makkah and Madinah an individual non-Saudi may buy only if Muslim and only in designated zones.
2. Non-residents: obtain a digital identity, a Saudi bank account and a Saudi number.
3. Apply on the Saudi Properties portal.
4. Find the project and the developer on Wafi: on the project card, match the licence number and validity, the bank and the escrow account number against the contract, and check the developer's qualification.
5. Review the contract: payment schedule, handover date to the day, specifications, delay compensation, termination.
6. Pay the reservation (capped at 5% under a marketing licence) and all instalments electronically, into the contracted escrow account only.
7. Register your right with the Real Estate Registry and keep every payment record.

This sequence is compiled from official and secondary sources; there is no single official checklist, so have a licensed Saudi lawyer review your transaction.

According to developers' materials, our catalogue includes projects sold off-plan, such as Darco Prime, Ayala Al Muhammadiyah and Nesaj Al Sadan in Jeddah and Retal Rise in Al Khobar. Check the Wafi licence for each of them: ask for the licence number and escrow details, and before reserving match them against the project card on Wafi and the contract. Whether a specific address is open to a foreign buyer is checked separately.

Frequently asked questions