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Wed 4 May 2016 02:31 PM

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Saudi Arabia moves to end 'illegal' property lease deals

Up to 90% of current lease agreements are illegal, according a Saudi real estate expert

Saudi Arabia moves to end 'illegal' property lease deals
The Kingdom Tower stands illuminated at night on King Fahad Road in Riyadh, Saudi Arabia, on Monday, April 9, 2012. Saudi Arabias gross domestic product expanded 6.64 percent in the fourth quarter from a year ago, the kingdoms statistics agency said. (Bloomberg)

Saudi Arabia is due to implement the Ejar system in six months to regulate the relationship between landlords and tenants, local media has reported.

The Landlord-Tenant Law, which is expected to be operative in six months, will resolve the issues relating to the current leasing contracts in the kingdom, of which approximately 90 percent are illegal, Khaled Al-Mobayed a real estate expert was quoted as saying to a local publication.

Al-Mobayed further explained that the law would be mandatory, but would not take responsibility for setting rents which are subject to supply and demand.

The new law is being implemented in four stages.

Al-Mobayed added that the system would receive a wide welcome by those working in the property industry, especially if the unified single contract system and the electronic payment system became applicable throughout the kingdom.

The Ministry of Housing recently announced that real estate offices in the kingdom were obliged to register on the platform.

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