Buying a home in Saudi Arabia: the cash you need on the day
Updated
How much is the real estate broker's commission?
The broker's commission on a sale is 2.5% of the price unless you agree otherwise in writing, and it is paid by whoever signed the brokerage contract. On a SAR 1,500,000 home that is SAR 37,500, plus 15% VAT if the broker charges it (SAR 43,125). Only a broker with a REGA licence — the licence REGA calls "FAL" — may act for you, and the broker must show his name and licence number in every property advert.
| Sale price | Commission | With 15% VAT, if charged |
|---|---|---|
| SAR 750,000 | SAR 18,750 | SAR 21,562 |
| SAR 1,500,000 | SAR 37,500 | SAR 43,125 |
| SAR 3,000,000 | SAR 75,000 | SAR 86,250 |
The law: Real Estate Brokerage Law (Bureau of Experts) · check a licence: REGA FAL platform. Whether VAT applies to the commission is not stated on an official page we could read.
Official rule: The broker's commission is 2.5% of the sale price unless agreed otherwise in writing. (source, checked 2026-10-19)
Buying a SAR 1,500,000 home in Riyadh as a Saudi citizen's first home, with home finance and 10% down, costs about SAR 50,475 in fees — 3.4% on top of the price, including an estimated SAR 1,600 transfer fee — when the seller pays the 5% transaction tax, as the law says. If your deal makes you pay the tax, the state still pays SAR 50,000 of it for your first home and SAR 25,000 is yours. A non-Saudi buying the same home in Riyadh pays a further SAR 30,000 fee and needs at least 30% down at a bank.
First home vs other homes
| Case | Min. down | Down payment | Total cash |
|---|
What you pay every month after you buy
| Item | Monthly | Yearly |
|---|
- Only the home finance instalment follows exactly from your finance, as long as the term cost stays the same (variable rates and Sakani: home finance calculator). Insurance and service charges have no official number — they are your estimates and count only if you enter them.
Not a valid document. Estimate for information only — not financial advice, not an offer of credit and not a bank document. Errors are possible. Only your bank's or finance company's official offer letter, contract and statements are binding.
The costs on the day
- Real estate transaction tax: 5% of the price. By law the seller owes it, due on the day the sale is notarised; buyer and seller can agree who carries it in the price. The cost of a licensed home finance is not part of the taxed value. Buying a home carries no VAT — this tax replaces it.
- First home of a Saudi citizen: the state pays the tax on the first SAR 1,000,000 of the price (at most SAR 50,000). Above that, 5% applies to the rest.
- Non-Saudi buyers: a 2% fee in Riyadh, Makkah and Madinah cities and Jeddah governorate, 0% elsewhere, on top of the transaction tax. REGA levies this fee on a non-Saudi's property transaction in these four areas — its Arabic FAQ says on the sale of property a non-Saudi owns, its English FAQ when property is sold to non-Saudis — so budget for it when you buy and expect it when you sell. Ownership is allowed only inside the areas opened to non-Saudis (residents: also one home for their own use elsewhere), and in Makkah and Madinah only for Muslim individuals.
- The broker: 2.5% of the price unless agreed otherwise in writing, paid by whoever signed the brokerage contract.
- The lender: an admin fee of at most 1% of the finance or SAR 5,000, whichever is lower, plus 15% VAT. That cap covers the application, valuation, inspection and registration.
- The Real Estate Registry: registering a property for the first time is free.
What has no official number
We found no official fee schedule for municipal (amanah) fees, the sale transfer, notary work or utility connections. Municipal fees differ by city and no official rate is published, so you have to find the number yourself and enter it; left empty, the calculator ignores it and says so. For the transfer the calculator starts at SAR 1,600 — the figure reported in the press and by a law firm, not on an official page — and labels it as an estimate; utility connections count nothing unless you enter your own figure.
Where you buy matters
- Non-Saudi buyer fee: 2% of the value in Riyadh, Makkah and Madinah cities and Jeddah governorate, 0% elsewhere. GCC nationals pay it only in Makkah and Madinah.
- Where non-Saudis may own: only inside the zones REGA maps on its Saudi Properties portal: named development projects in Riyadh, Makkah, Madinah, Jeddah and AlUla; NEOM, AMAALA and the Red Sea; the economic cities and special economic zones; and towns and governorates in all 13 regions. In Riyadh and Jeddah city the zone is development projects on land within the urban boundary — not the city as a whole.
- A resident's own home: a legally resident non-Saudi may own one home for housing outside the zones (not in Makkah or Madinah); inside Riyadh or Jeddah's urban boundary that home may not be let out.
- Makkah and Madinah: as non-Saudis only Muslim individuals may own (a Saudi company with non-Saudi partners may), and only inside the zones.
- The same everywhere: SAMA's finance rules, the 5% transaction tax and first-home relief, VAT, Ejar registration and Sakani — none of them change with the city.
Details and the official sources: can foreigners buy property in Saudi Arabia?
Questions people ask
Who pays the 5% real estate transaction tax in Saudi Arabia?
In Saudi Arabia, by law the seller owes it, and it is due on the day the sale is notarised. Buyer and seller may agree who carries it in the price, so check your sale agreement.
Do Saudi citizens pay the tax on their first home?
The state pays the tax on the first SAR 1,000,000 of the price of a Saudi citizen's first home, at most SAR 50,000. On any part of the price above SAR 1,000,000 the 5% applies.
Is there VAT on buying a home in Saudi Arabia?
No — in Saudi Arabia, the sale of a property carries no VAT; the 5% transaction tax applies instead. Fees such as the lender's admin fee carry 15% VAT.
What extra do non-Saudis pay?
A 2% fee on the value in Riyadh, Makkah and Madinah cities and Jeddah governorate, and 0% elsewhere, on top of the transaction tax.
Where may non-Saudis buy?
Under the law in force since 22 January 2026, inside the areas the Council of Ministers opens to them; in Makkah and Madinah only Muslim individuals may own. A legally resident non-Saudi may also own one home for their own use outside those areas, but not in Makkah or Madinah. In Riyadh and Jeddah city the zones are development projects, not the whole city — check the plot on REGA's Saudi Properties portal.
How much down payment do I need?
For a Saudi citizen's first home a lender may finance up to 90%, so 10% down. For any other home a bank may finance up to 70% (30% down) and a real estate finance company up to 85% (15% down).