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Sun 25 Jul 2010 02:07 AM

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Saudi Arabian landlords prefer expatriate tenants

JCCI suggests a payment system that deducts rent directly from tenant's salaries.

Saudi Arabian landlords prefer expatriate tenants
POOR REPUTATION: Saudi Arabian landlords prefer renting their properties to expats as Saudis have a poor reputation for paying rent on time. (Getty Images)

With over 7,000 pending court cases in Jeddah alone, the Real Estate Committee at the Jeddah Chamber for Commerce and Industry (JCCI) in Saudi Arabia, has recommended setting up a payment system that could lead to banks taking rent amounts directly from a person’s salary every month.

Saudi landlords often prefer renting out their apartments to expatriates as their fellow Saudis have a poor reputation in paying rent on time.

Abdulghani Al Sabbagh, landlord and former member of the Real Estate Committee, said: “I refuse to rent apartments to Saudis. Most of them only pay during the first year and then start delaying payments after that. They also ignore other rules relating to parking space, paying for water and stuff like that.”

He added: “Most of them suddenly disappear without notice and without paying outstanding dues. They leave behind their furniture and in such cases we have no choice but to complain to the police. This usually takes a long time and we’re not allowed to open the apartments without the police.”

Awad Al Dowsi, member, Real Estate Committee, said that the JCCI’s suggestion of paying rents through banks needed to be implemented.

He said: “This is a wide spread problem, tenants are not the victims, it’s the landlords who are. The JCCI’s recommendation would ensure both landlords and tenants’ interests are looked after.”

Despite this being a widespread problem, no proper rental laws have been implemented by the municipality yet.
Although landlords can take their grievances to the municipality or the police, the cases would take a long time to be resolved.

Abdullah Niazi, a Saudi based lawyer, said: “All these problems can be addressed quickly with the establishment of executive courts that implement the rules within limited time periods.”

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abumishari 10 years ago

Sure because they got the money to pay on time and keep up the hikes in the rent. The expat got the good paying jobs while the Saudis' cannot afford the annual hike of 25% and more because they do not make enough money to pay. The Saudis’ that have the money either build or buy their own homes not put up with the greedy landlords Another reason is that the landlord can bully the expat without the fear of getting sewed. A supporting evidence of this is that in the eastern region all the landlords prefer Aramco and SABIC Saudi employees because these two companies employ Saudis’ on well paying jobs. Any other excuse is a mere illusion.

Punch 10 years ago

Interesting to see that these situations are more regional than just a single location...one can draw one's own conclusions without help from me, but what is clearly clear that the property laws are inadequate, and it will be surprising to see if they improve in the foreseeable future...perhaps you remember the still-to-be-implemented Dubai Status Law???

Hussain 10 years ago

i second that... I once appleid for an apartment and even though i could afford to pay the wholes year rent i was turned down cause im saudi Saudis cannot afford the Rent hikes and mostly suffer from low wages and debt. Expats have all the high paying jobs + vehicles + Their accommodation is payed for by their companies. As abumishari said... Only Aramco and Sabic employees are given a chance and even they are beginning to suffer.

nigel 10 years ago

dont worry it wont last too long as it will go the same way as the UAE companies pay the rent in a package, the owners get gready and keep putting the rent up, the companies decide that they are paying too much, then decide to give the employees a portion of the rent and they have to foot the rest!! one thing the UAE has learnt is that the gready landlords make money for a while but then fall on hardship and strugle to even cover the mortgages they have taken out believing the rental prices will stay high!!!

RAK 10 years ago

"Expats have all the high paying jobs + vehicles + Their accommodation is payed for by their companies" - are you joking?? If you look at the major companies, all the top jobs (and therefore the highest paid) are held by Saudis. Even at the mid level, Saudis get paid for the same skill set. What you should compare is the spending habits of Saudis vs expatriates - you only need to look at the shopping malls to come to the conclusion. You are worth what you save!

Expat 10 years ago

Both of you are saying the true scenarios, there are cases that expats are paid well while Saudis are not and vice-versa. Now, if I'm the employer in Saudi and I know the Saudization law plus the fact that almost all of the companies here in Saudi prefer expats, then, I would make my hiring procedure stringent enough and make sure not be biased on race. I will make sure that I will hire the right person on a particular position together with its corresponding compensation package.

Hussain 10 years ago

Not true, Its not about the skills, Its about nationality... And to go straight out and accuse all saudis of cheating jsut shows how much you know about the situation. Im saudi and ive never cheated or delayed my rent except for once when i was out of town on business...but that was rsolved without cheating or lying. Saudis can not even afford basic Housing anymore... the one that do are either on government jobs or living of family. The lies and cheating are due to the poor wages saudis are being paid regardless of their qualification. Arabian Bussiness conducted a survey last year that proves it. Sauid are not cheats and liars... for msot of the construction firms that ahve embezzled this country are mostly run by expats of arab nationalities.... poor quality, no standards and no safety.... "read articles on worker heat stroke deaths" I work in construction and i have seen the atrocities first hand and was assaulted by these honest "expasts" on several occasion for speaking up about it. I work a job for a fee and an expat in the same job and position earns 3 times what i do. it has nothing to do with merit or hard work. I have applied for hundreds of jobs and turned down only because i am Saudi. Young and Saudi. @expat in Jeddah, agreed... thats what id wish for. but alas, im not saying all expats are bad, and im not saying they dont deserve their packages... but there needs to be some equal and just standard. Mr.Fahad above is just afraid of people like me speaking up cause we pose a threat to their way of life. If Most of the Educated Saudis who hold BsC's and MSc's had a fair chance... the number of expats in the kingdom would be 30% what they are now. I rest my case. If any of you dont beleive... ill be happy to lead to the facebook groups full of angry young American educated Saudis. regards

architect 10 years ago

This seems hillarious. You have poor saudis complaining about other saudis who seem to be exploiting them. This is what generally happens when there isnt a democracy. A few people just get richer and richer and keep everything to themselves. I cant believe that Saudi Arabia, one of the riches countries in the world has so many poor people. There is nobody to blame other than those poor saudis themselves. They need to rise up and ask for freedom and democracy. so they can also share in the wealth of that nation. Until that happens there will always be saudis begging on the streets and dying of starvation while a few in power take all the wealth of that country.

Joe 10 years ago

Why is this the case? Shouldn't the young educated Saudis be getting the jobs so that the kingdom relies less on expats and grows the domestic labour market? For most countries the goal should be to have their own young people in the jobs in all areas and at all levels. After the local population has the jobs that they have the skills to do, then you get expats to do the jobs no locals can do as well!

Hussain 10 years ago

@Arch. Ahh a taboo subject. all i can say is "tik tok tik tok" @Joe Please pay Saudi arabia a visit and talk to the saudis... its all PR They implemented this Saudization System and its a failure, A total load of rubbish, The lower jobs are being filled by saudi's gradually, however teh higer paying jobs are 90% dominated by expats for several reasons. 1-Expats have no sense of loyalty to the nation, they are jsut here for the money and its no secret. However some use the support of their Powerful saudi sponsor to take advantage, this is dominant in the construction industry. Saudis are a threat because they may expose fraud and come forward and many business leaders don't want that. 2-Most of the rich business leaders are uneducated and are only concerned about the quick buck and not the future of the nation "why should they.. they have nice spanish villas n nice and a swiss bank account and a foreign wife "the saudi dream" 3-the is a HUGE gap between the discision makers and the little people and this gap is filled with liars and cons. If only you could read saudi newspapers in english :(