Saudi Arabia approves vacant property fee regulations to boost housing supply
Saudi Arabia’s Ministry of Municipalities and Housing approved regulations imposing fees on vacant properties to enhance real estate market balance and encourage utilization. The rules define unoccupied buildings as those unused for six months, with annual fees capped at 5% of a property’s estimated rental value, exempting cases beyond owner control.
Saudi Arabia’s Ministry of Municipalities and Housing has finalized regulations for vacant property fees, targeting underused residential and commercial buildings to address market imbalances. The move aligns with directives from Crown Prince Mohammed bin Salman to regulate the real estate sector and improve supply-demand dynamics. The regulations apply to vacant buildings within designated geographic zones, determined by vacancy rates, supply-demand levels, and property prices. A property is classified as vacant if unused for six consecutive or non-consecutive months, with fees assessed based on ownership share for multi-owner properties. Annual fees will not exceed 5% of a property’s estimated rental value, calculated using approved valuation standards. Owners facing unavoidable occupancy issues—such as renovations or legal constraints—are exempt. Revenue from these fees will fund housing projects and urban development initiatives. The ministry has outlined a six-month payment grace period after invoice issuance and established procedures for appeals. The framework aims to optimize land and real estate asset efficiency while supporting broader housing supply goals.
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