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Saudi crown prince freezes rents in Riyadh

26 September 2025

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Riyadh has moved to stabilise the rental market in the capital, unveiling a sweeping five‑year freeze on annual rent increases together with a suite of other measures designed to stabilise landlord‑tenant relations, improve transparency and deter speculative behaviour.

Crown Prince Mohammed Bin Salman Bin Abdulaziz Al-Saud announced the measures on 25 September, following remarks he made earlier in the month about rising property prices and his willingness to intervene.

At the core of the reforms is a five‑year suspension of annual rent increases for residential and commercial leases in Riyadh. Landlords are barred from raising “the total rent value” in both existing and new contracts during this period. The General Authority for Real Estate may extend these provisions to other cities if required, subject to approval by the Council of Economic and Development Affairs.

Complementing the freeze, the regulations fix the asking rent for vacant units that were previously leased at the value recorded in the last lease agreement, while rents for units never leased will be set by mutual consent.

All lease contracts must be recorded in the government’s Ejar electronic registry; either party can request registration, and an objection window is available to resolve disputes. The package also includes controls on automatic renewal, strict grounds for non‑renewal in Riyadh, and a formalised objection route for landlords whose properties have undergone value‑adding renovations.

Violations will attract fines of up to 12 months’ rent, with appeals processes and whistleblower rewards built into enforcement mechanisms.

The measures come as the Saudi economy undergoes transformation. Non‑oil activity has grown rapidly, and major capital expenditure projects – including the five self‑styled giga‑projects – along with corporate relocations, have driven up demand for quality housing and commercial space. 

Rising rents

Riyadh and Jeddah have seen double‑digit rental rises in some districts, squeezing households and raising questions about the distributional impacts of growth under Vision 2030.

The crown prince addressed the issue in September, saying there is a need to “rebalance the sector, reduce costs, encourage real estate development and provide diverse housing options.”

For tenants, the measures will provide welcome relief from rising rents. They will also reduce the risk that liberalisation measures – such as the new law allowing foreign ownership in designated areas from early 2026 – will lead to further price increases by opening the market to additional capital.

The intervention poses potential side effects for landlords, developers and market dynamics. A multiyear cap on rent growth could compress returns for owners, particularly those who financed acquisitions or developments under assumptions of steady nominal rent increases.

MEED’s October 2025 special report on Saudi Arabia includes:

> GOVERNMENT: Riyadh confronts rising regional chaos
> ECONOMY: Riyadh looks to adjust investment approach
> BANKING: New funding sources solve Saudi liquidity challenge
> OIL & GAS: Aramco turns attention to strategic projects
> GAS: Saudi Arabia and Kuwait accelerate Dorra gas field development
> POWER: Saudi Arabia accelerates power transformation
> WATER: Transmission projects drive Saudi water sector growth
> CONSTRUCTION: Saudi construction pivots from gigaprojects to events
> TRANSPORT: Infrastructure takes centre stage in Saudi strategy

To see previous issues of MEED Business Review, please click here

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Colin Foreman

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