Riyadh Rent Freeze: Five-Year Cap Explained for Landlords & Tenants

What Saudi Arabia’s five-year rent freeze in Riyadh means for residential and commercial leases: scope, dates, enforcement, and practical steps for landlords and tenants—with reliable sources.

Riyadh Rent Freeze: What a Five-Year Cap Means for Landlords and Tenants

Saudi Arabia has frozen rent increases in Riyadh’s urban area for five years, effective September 25, 2025. The freeze applies to both residential and commercial leases and covers existing and new contracts. The applicable rent is the amount in effect on the start date of the policy and remains binding for the full period. Authorities have indicated the measure could be extended to other cities if needed.

Key Points at a Glance

  • Scope: Within Riyadh’s officially recognized urban boundary; both residential and commercial properties are covered.
  • Duration: Five years from 25 September 2025.
  • Contracts Affected: Applies to existing and new leases; escalation clauses are neutralized by the freeze.
  • Enforcement & Penalties: Violations can trigger fines (reported up to a year’s rent) and compensation to affected tenants.
  • Possible Expansion: The Real Estate Authority may extend the policy to other cities, subject to government approval.

Why It Happened

The decision follows a surge in rents and property prices in the capital during recent years. Market reports cited double-digit annual rent growth in villas and solid increases for apartments, prompting an intervention to stabilize costs and protect households and businesses.

What Landlords Should Expect

  • Pricing Locked: Annual step-ups and CPI-linked increases cannot be applied during the freeze period.
  • Lease Strategy: Expect longer terms, incentives (fit-out, rent-free periods), and service-charge clarity to drive occupancy rather than price rises.
  • Renewal Dynamics: Commentary from law firms notes automatic renewal features accompanying the freeze—review renewal clauses carefully.
  • Compliance: Keep written records of the last contracted rent and any lawful adjustments (e.g., documented incentives) to evidence compliance if audited.

What Tenants Should Expect

  • Predictability: Greater visibility over occupancy costs for five years supports budgeting and medium-term planning.
  • Negotiation Power: With rents capped, negotiations may shift to length of term, break options, and fit-out contributions rather than base rent.
  • Reporting Violations: Penalties apply for non-compliance; tenants are encouraged to keep proof of any unlawful rent-increase requests.

Simple Scenarios

Scenario Before Freeze During Freeze Notes
Apartment lease with 5% annual step-up Rent rises 5% on each anniversary Step-ups cannot be enforced; base rent remains fixed Freeze supersedes escalation clause.
New office lease signed in 2026 Market rent negotiated with annual uplifts Base rent set at signing; no increases for the freeze period Applies to commercial leases as well.

Frequently Asked

Does the freeze change service charges or utilities? No, the policy targets base rent levels. Other charges continue per contract and regulation.

Will the policy expand to other cities? Officials have said it’s under study and could be extended if market conditions warrant.

Disclaimer: This article summarizes publicly reported measures as of October 2025. It is not legal advice. Always review your lease and consult qualified counsel for specific situations.

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