Rent Freeze in Riyadh: REGA, Ejar Regulations, and Investment Outcome

Riyadh introduced a five-year rent freeze starting September 25, 2025. For an investor, this means verifying lawful income before negotiating the purchase price. According to an Ejar announcement, the restriction applies to existing and new residential and commercial contracts within the city's urban boundaries. Buying an apartment or changing the tenant does not automatically open the way to a higher rate.

Employment growth and corporate relocations may support demand for housing. However, they do not justify factoring an annual 5–10% increase into calculations. First, it is necessary to establish the unit's history, total rent, and owner's costs. Only then can the price be evaluated.

The schema below covers a rented unit, a vacant unit with a history, and a previously unrented unit. Source verification date: November 9, 2026. The sample amounts are a simulation, and the assessment of a specific contract requires documents and local legal analysis. The time basis is described in the official Ejar announcement.

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How to check if a unit is subject to restrictions in Riyadh?

The reference point is Riyadh's urban boundaries, not the entire province or the marketing name of the agglomeration. The freeze covers residential and commercial properties; it is not automatically a ban on rent increases in Jeddah or Dammam. Regulations permit territorial expansion, so the location's status must be verified before the transaction.

City boundaries and property purpose

Step 1. Determine the location of the plot and unit

Action: match the address, coordinates, plot number, and unit identifier. Source/Document: title deed, address data, and official Balady maps or the Riyadh geoportal. Verification: confirm that it is the same property across all documents. The government description of city maps indicates the availability of data on boundaries and land use.

Step 2. Confirm the purpose and legal title

Action: read the unit's purpose and owner details. Source/Document: electronic title deed (referred to as a sakk), building documentation, and the relevant real estate registry. Verification: compare the unit number, share, and function with the contract. Residential character is not the sole premise for falling under the restriction.

Step 3. Check the current scope of regulations

Action: determine the regulations applicable to the location and the date of the contract. Source/Document: applicable REGA regulations. Verification: record the legal basis and the date of inspection.

Step 4. Link the unit to the contract history

Action: assign the contracts to the unit you intend to buy. Source/Document: Ejar exports, addendums, and documents regarding any disputes. Verification: clarify discrepancies in numbers and addresses. The absence of a dispute notice in the dashboard does not prove the absence of proceedings.

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How to determine rent based on rental history?

For a rented unit, the starting point is the current contract, and for a vacant unit with history—the last lease agreement. The rate for a previously unrented property is agreed upon by the parties. The law defines total rent more broadly than just the base fee, also encompassing other amounts paid to the lessor based on the contract.

Three unit statuses and total rent

Step 1. Establish the actual history of the unit

Action: classify the unit as rented, vacant after a lease, or previously unrented. Source/Document: current and previous Ejar contracts and the seller's documentation. Verification: the lack of an active contract does not mean a lack of history. In a vacant unit, the last rate does not disappear when the tenant moves out. Secondary market purchase also does not reset the limit.

Step 2. Separate rent, services, and security deposits

Action: read the annual value in SAR, the installment schedule, service charges, and deposit refund rules. Source/Document: the full contract with attachments, not just the first page. Verification: account for comparable periods and determine the nature of each amount. Do not treat a refundable deposit as income. Renaming part of the rent into a mandatory fee does not determine its admissibility.

Calculation-only example: the last annual rent was 60,000 SAR. An offer for a similar apartment at 72,000 SAR does not entitle you to enter this amount into the new contract. On the other hand, the initial rate for a unit that has never been rented requires valuation and agreement with the tenant.

Step 3. Assess the grounds for formal objection

Action: check the possibility of challenging the limit for a vacant, previously rented property. Source/Document: Part Three of the REGA regulations, a valuation report by a Taqyeem-accredited appraiser, and required permits. Verification: grounds may include significant construction work or the last contract being older than 2024. Routine refreshing does not automatically grant the right to a price increase. The procedure is not a general exception for active contracts. In the model, keep the existing limit until a resolution is reached.

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How to verify a contract and unit data in Ejar?

Ejar is used to document contracts and settlements and serves as the primary data source for rental audits. A printout alone does not confirm the validity of the title deed, the absence of arrears, or the absence of a dispute. Nor should the obligation of registration be equated with the claim that every paper document is devoid of legal significance.

Contract and mada/SADAD payment audit

Step 1. Check access and authorization

Action: ask the owner or authorized representative to present data after logging into the official service. Source/Document: the Ejar platform described by REGA, identity document, and power of attorney. Verification: determine the scope of authority of the person showing the contract. In Ejar, the property owner should control the data and access of their representative.

Step 2. Compare the parties and unit parameters

Action: match the data of the lessor, lessee, and unit with source documents. Source/Document: full Ejar contract, title deed, and National ID or Iqama, depending on the party's status. Verification: check the deed number, address, area, contract period, rate, and all addendums. If the tenant is a company, determine representation.

Step 3. Reconcile payments with receivables

Action: assign each installment to a due date and confirmed payment. Source/Document: Ejar statement, mada/SADAD payment channel confirmations, and owner's bank statements. Verification: clarify underpayments, overpayments, pending payments, and rent paid in advance. According to the Ejar FAQ, the requirement for payment through platform channels applies to new residential contracts; do not carry this rule over to every commercial contract without checking.

Step 4. Examine dispute status and documents

Action: check contract validity, renewal, termination, and reported claims. Source/Document: contract history, parties' notices, and proceeding documents. Verification: resolve discrepancies before transferring funds. The mere status of an active contract does not preclude a dispute or sublease. Compare sublease conditions with the actual use of the unit and the inspection report.

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How to calculate investment return without annual rent increases?

The model should maintain lawful rent without automatic indexation for the remainder of the freeze period. Next, realistic revenue losses and costs must be deducted, and the result related to the buyer's total outlay. Show apartment appreciation separately from rental cash flows.

Fixed rent, Mullak costs, and Net Initial Yield

Step 1. Record lawful income in SAR

Action: enter the contract amount and separate installment payment dates. Source/Document: Ejar and payment history. Verification: remove the assumption of annual growth of 5–10%. In projections covering the post-regulation period, designate any further rate as an assumption. Five years are counted from the entry into force of the regulations, not from the purchase date of each apartment.

Step 2. Determine owner's costs

Action: gather management, HOA (Mullak), insurance, and routine repair costs. Source/Document: budget, invoices, and the Mullak program rules. Verification: distinguish unit costs from common area costs. Determine the basis for any tenant charges; do not treat every invoice as a recoverable cost. Ejar and Mullak maintain separate settlements, so merely checking the contract does not conclude the fee review.

Step 3. Add vacancy and capital expenditures

Action: assume revenue loss scenarios and a separate reserve for equipment replacement. Source/Document: unit history, property manager offers, and technical inspection. Verification: treat a 5–8% vacancy rate solely as a sensitivity test, not a Riyadh average. Do not deduct the same repair once as a current expense and again as a reserve.

Step 4. Calculate income and total outlay

Action: divide NOI by the buyer's outlay. Simulation: price 1,000,000 SAR, rent 60,000 SAR annually, revenue loss 3,000 SAR, and OPEX 12,000 SAR. Net Operating Income (NOI) is 45,000 SAR. With an outlay of 1,080,000 SAR, the NOI-to-outlay yield is approx. 4.17%. After a 3,000 SAR technical reserve, 42,000 SAR remains, which is approx. 3.89% of the outlay. This is a pre-financing and pre-tax investor result.

Source/Document: ZATCA guidelines regarding RETT. Verification: RETT is generally 5%; the seller is liable to the authority, although the parties may agree that the buyer will bear the cost. The simulation assumed such a cost: 50,000 SAR in tax and 30,000 SAR in other outlays. Check exemptions and all fees specific to the transaction.

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Vision 2030 and the distinctiveness of rental regulations

The RHQ program, demographics, and housing affordability

Vision 2030 outlines the direction of economic development. The Regional Headquarters Program aims to attract regional headquarters of international enterprises to the Kingdom. This may support housing demand for employees and management staff.

The figure of 15 million residents in Riyadh by 2030 cited in debates requires proper context. The RCRC VLR 2024 report distinguishes between a more conservative projection of 10 million residents and a more ambitious scenario of 15 million. These are projections, not a confirmed future population. Do not mechanically convert them into rent increases for a specific apartment.

Rising demand can coexist with regulations protecting housing affordability. For authorities, the stability of city living costs and conditions for business operations are elements of development. For an owner, this means the necessity of seeking returns through purchase price, cost control, and rental quality.

What to actually check before choosing a district?

Identify the target tenant group and their budget. Compare commuting times to workplaces, service availability, building parameters, and competitive supply. Ask the property manager for examples of signed contracts and tenant search periods. Advertisements show bidders' expectations; they confirm neither the concluded rate nor the permissible limit of the examined unit.

A higher purchase price may mean a lower yield even with good occupancy.

A broader context is described in the Saudi Arabia real estate investment guide. However, when calculating a specific offer, maintain separate assumptions for the city, the district, and the unit itself.

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Documents before purchasing a tenanted unit and FAQ

What to check before signing a purchase agreement?

A tenanted property in Saudi Arabia requires an inspection of the existing tenancy relationship. A change of owner does not raise the existing limit. The price should reflect the conditions being taken over, and the transaction settlement—collected installments, deposits, and arrears.

• Title Deed: check the owner, encumbrances, and disposal rights in Najiz or the relevant RER registry, depending on the property status.
• Ejar Contract: obtain the full version, addendums, history of previous rates, and renewal or termination notices.
• Payments: compare receivables with inflows, rent collected in advance, and the security deposit. Determine the date of income division between the transaction parties.
• Mullak: request the current balance, budget, and confirmation of payment settlement from the property manager. Do not assume the existence of a single mandatory "clearance certificate" template.
• Technical Condition: compare the tenant handover protocol with the current inspection. Record defects, equipment, and responsibility for repairs.

For a foreigner, the ability to acquire a specific right to a unit requires separate verification. For reference, read the description of the property purchase process in KSA for foreigners, and confirm the current status for your selected transaction.

Does the restriction in Riyadh mean an identical ban in Jeddah?

No. The local scope of the freeze does not automatically transfer to other cities. Some rules on documentation and contract renewal have a broader reach. Check current REGA decisions instead of treating Riyadh as a benchmark for the entire Kingdom.

Do regulations apply only to apartments?

No. They also cover commercial and mixed-use properties within the specified area. The purpose and type of contract must be checked separately.

When can an owner refuse renewal?

REGA regulations on contract renewal provide specific grounds: non-payment, structural hazard confirmed by an appropriate report, and the owner's or a first-degree relative's need to reside there. REGA may specify further cases. The mere sale or desire to find a higher-paying tenant is not a listed ground.

The rule is automatic renewal, with notice of non-renewal at least 60 days before the end. The law contains exceptions, including transitional ones; check the specific contract and any longer notice period. In Riyadh, the notice period does not replace the required grounds for refusal.

What penalties apply for hidden surcharges?

REGA penalty regulations provide for a fine of up to 12 months' total rent, the removal of the violation, and the possibility of claiming damages. The specific penalty depends on the qualification and circumstances of the violation. Cash or a foreign account does not legalize circumventing the limit; actual services must be distinguished from a hidden price increase.

Must the lease be signed again after a sale?

Ejar provides a lessor change service via an authorized broker after proving the transfer of ownership. The new lessor accepts the change, and the tenant receives a notification. A new version is created under the same contract number; previous versions remain in the system.

Registration does not disappear upon sale. After updating, check the parties' data, account, remaining installments, and preservation of conditions. The settlement of already collected deposits and rent should also be recorded in the sales documents.

Does a renovation allow you to bypass the restriction on your own?

No. Significant work may justify a formal objection regarding the limit for a vacant unit with a rental history. Documents and a resolution through the proper procedure are required.

Does Vision 2030 guarantee rent growth?

No. The program is not a commitment to the owner nor a departure from REGA regulations. Demand, the legal limit, and costs are separate elements of the analysis.

Does short-term tourist rental allow bypassing the freeze?

It should not be treated as a simple workaround. The Ejar FAQ describes new rules for contracts longer than three months. Tourist activities have separate requirements from the Ministry of Tourism, including licenses or permits specific to the property and operator.

Before changing the model, check the owner's rights, the building's purpose, and the HOA rules. A shorter contract alone does not determine the legality of tourist activities.

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How to prepare a purchase with PlanoGroup?

Before submitting an offer, prepare a complete set of unit documents, Ejar history, and a Mullak cost statement. Discuss the scope of price, income, and transaction organization analysis with the PlanoGroup team. Agree on the involvement of a local lawyer, authorized broker, and property manager. The audit should conclude with a list of findings, discrepancies, and purchase conditions. Only then should you compare the price with the verified income and the outlay required to maintain the property.