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All contracts must be registered in the “Ejar” network with a 60-day objection period. Contracts renew automatically unless notice is given, and violations may result in fines up to 12 months’ rent, with whistleblowers receiving rewards.
In line with the directives of His Royal Highness Prince Mohammed bin Salman, Crown Prince and Prime Minister, the Saudi Council of Ministers has approved new regulatory provisions governing the relationship between landlords and tenants in Riyadh. The decision comes as part of efforts to address rising residential and commercial rents in the capital and introduce a framework based on international best practices, reported Al Anba newspaper.
The Cabinet decision includes several measures. First, rent increases for residential and commercial lease contracts, whether new or existing, will be suspended for five years.
The provisions may later be applied to other cities upon approval. Second, the rental value for vacant properties will be fixed according to the last lease contract, while first-time leases will be set by agreement between landlord and tenant.
Third, all contracts must be documented through the “Ejar” network. Both landlords and tenants can submit contracts for registration, with a 60-day window to raise objections before the General Authority for Real Estate. Fourth, rental contracts across the Kingdom will be automatically renewed unless one party provides notice at least 60 days before expiry. In Riyadh, landlords cannot refuse renewal if tenants wish to extend, except in cases of nonpayment, major structural defects, or personal use by the landlord or a first-degree relative.
Fifth, landlords may object to rental values if the property undergoes major renovations or if the last lease was signed over a year ago. Sixth, violations of these provisions may result in fines of up to 12 months’ rent, with compensation for affected parties. Whistleblowers can receive up to 20% of collected fines.
Seventh, where no specific rules apply, the Civil Transactions Law will govern contracts. The Council of Ministers may amend the provisions based on reports from the General Authority for Real Estate.
Authorities will oversee implementation, publish clarifications, and monitor rental trends to ensure compliance. Regular reports will be submitted to the Crown Prince, reflecting his commitment to protecting the rights of both landlords and tenants.
These measures mark a pivotal step towards stabilizing Riyadh’s rental market, fostering transparency, and creating a fair, secure environment that supports quality of life and sustainable urban development.
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