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Before Buying a Property, Don’t Rely on Words and Promises: A Comprehensive Guide to Protecting Your Rights in Saudi Arabia

Buying property in Saudi Arabia is an important financial decision, whether the purpose is residential use, investment, establishing a business, rental income, or property development.

With the high value of many real estate transactions, making a purchase decision based solely on verbal statements or marketing promises may expose the buyer to risks that could have been identified and addressed before signing the contract or making significant payments.

A property may appear suitable in terms of location, price, and size, and the seller or real estate broker may provide reassuring information. However, this does not replace the need for legal and regulatory due diligence on the property and the transaction.

Before buying any property in Saudi Arabia, it is not enough to simply like the property. You should verify its ownership, documents, restrictions, permitted use, contract terms, obligations, and transaction-related costs.

This comprehensive guide explains the key issues buyers should consider before purchasing property and how proper verification, documentation, and due diligence can help reduce potential risks.

Why Is Verbal Information Not Enough When Buying Property?

A seller or real estate broker may provide information such as:

The property is legally owned by the seller and has no issues.
The property is suitable for commercial use.
Additional floors can be constructed.
The property can be subdivided in the future.
The property is free from obligations.
The transfer of ownership can be completed easily.
The area will undergo future expansion or a change in permitted use.
A real estate project will be completed by a specific date.

However, buyers should not base their decisions solely on such statements.

Real estate transactions involve official documents, registered information, contracts, and obligations that may directly affect the property’s value, use, and ability to be transferred.

Therefore, material information concerning the property should be verifiable and supported by evidence, rather than based solely on promises or verbal statements.

This is particularly important in light of the regulations governing Real Estate Registration and the rights and obligations recorded in connection with the property.

1. Verify Property Ownership Before Making Any Payment

The first step in purchasing property is confirming that the person offering the property for sale is the legal owner or has the legal authority to complete the transaction.

It is not advisable to rely solely on a copy of a document sent by the seller through messaging applications or on information provided by a broker.

Instead, ownership information should be verified through the relevant official channels and sources.

What Information Should Be Reviewed?

It is important to review:

The owner’s name and details.
Property information.
Property location.
Property area.
Boundaries and description.
Type of property.
Permitted use.
Registered rights.
Obligations and restrictions associated with the property.
Any other information that may affect the transaction.

Under the Saudi Real Estate Registration Law, the title registration document includes information concerning the property, including its location, boundaries, description, use, rights, obligations, and ownership details, in accordance with the applicable provisions.

Why Is This Important?

Because making a payment or signing an agreement with a person who does not have the legal authority to dispose of the property may result in complex legal and financial problems.

Therefore:

Verify the seller’s ownership and legal capacity before making substantial payments or entering into a final commitment to purchase.

2. Do Not Assume That the Property Is Free from Rights and Restrictions

Buyers may focus on the price, size, and location while overlooking the property’s legal status.

However, ownership of a property does not necessarily mean that it is free from all rights, restrictions, or obligations.

The property may be subject to rights, obligations, or restrictions that affect its transfer or use.

Depending on the circumstances, buyers should investigate whether the property:

Is mortgaged.
Is subject to real rights.
Has registered obligations.
Is subject to restrictions on disposal.
Is associated with litigation or registered claims, where applicable.
Is subject to third-party rights.
Has any registered information that could affect the transaction.

The Saudi Real Estate Registration Law regulates the registration of transactions that create, transfer, amend, or terminate real rights. The real estate register also includes rights and obligations affecting the property in accordance with the applicable law.

An Important Rule:

Do not purchase a property based solely on knowing who owns it. Understand the property’s complete legal status.

3. Compare the Property Documents with the Actual Property

Having ownership documents does not mean that the buyer should ignore the property’s actual physical condition.

The official information should be compared with the property’s physical reality, particularly when purchasing high-value properties, commercial properties, or land intended for development.

It is advisable to verify:

Area.
Boundaries.
Location.
Buildings and structures.
Number of units.
Entrances and exits.
Parking spaces, where applicable.
Current use.
Relevant plans and drawings.
Any existing additions or structures.

Why Is This Important?

Because discrepancies between the actual property and the official documents may create problems with:

Financing.
Development.
Future resale.
Leasing.
Obtaining certain permits.
Modifications or construction.
Dealing with the relevant authorities.

Therefore, property due diligence should not be limited to reviewing documents; it should also include verification of the property’s actual physical condition.

4. Make Sure the Property Can Be Used for Your Intended Purpose

One common mistake is purchasing a property based on an assumption that it can be used for a particular activity without verifying the applicable legal requirements.

Buying a property does not automatically mean that every type of activity is permitted on it.

The buyer’s intended purpose may include:

Residential use.
Residential leasing.
Opening a retail store.
Establishing an office.
Operating a restaurant.
Establishing a clinic.
Setting up a warehouse.
Developing a commercial project.
Constructing multiple units.
Conducting an activity that requires a specific license.

The buyer should therefore verify the permissibility of the intended use before completing the transaction.

Do Not Rely on Statements Such As:

“You can use the property for any activity.”

Unless such information is supported by the applicable requirements, approvals, and regulations.

A property may be suitable from an engineering or location perspective but may not be legally suitable for the activity the buyer intends to conduct.

5. Assess Development Potential Before Purchasing Land

If the purpose of purchasing the property is development, confirming ownership and price alone is not sufficient.

The buyer should assess whether the proposed development can actually be implemented, including matters relating to:

Land use.
Planning and zoning requirements.
Building requirements.
Setbacks.
Permitted number of floors.
Building coverage ratios.
Parking requirements.
Utilities and infrastructure.
Required licenses and permits.
Any site-specific or activity-specific requirements.

An investor may purchase land based on certain expectations about a proposed project and later discover that some elements of the project are not permitted or require additional approvals.

Therefore, if the primary purpose of the purchase is real estate development or investment, it is advisable to assess the legal and technical feasibility of the proposed project before making a final commitment.

6. Do Not Sign the Sale Contract Before Reviewing It

A transaction may appear attractive in terms of price and location, but the contract may contain provisions that directly affect the rights and obligations of both parties.

A sale contract should not be treated as a mere formality.

It should be carefully reviewed and fully understood before signing.

Key Contract Provisions to Consider

Parties’ Information

Verify:

Seller’s information.
Buyer’s information.
Legal capacity of each party.
Authority of any representative or attorney-in-fact signing on behalf of a party.

Property Description

The property description should be clear and consistent with the official documents and registered information.

Purchase Price

The contract should clearly specify:

Total purchase price.
Initial payment.
Payment method.
Payment schedule.
Applicable payment arrangements.

Deposit

The buyer should understand the nature and legal effect of any deposit or earnest money in accordance with the contract and applicable laws.

Completion and Transfer Date

The parties should clearly identify their obligations concerning completion of the ownership transfer and the procedures associated with it.

Breach of Contract

The buyer should understand the consequences of a party’s failure to fulfill its contractual obligations and any remedies or consequences specified in the agreement.

Pre-Existing Obligations

The contract should clearly identify responsibility for any outstanding amounts or obligations associated with the property, in accordance with the contract and applicable laws.

A clear contract does not eliminate every possible dispute, but it helps define the parties’ rights and obligations and can reduce areas of disagreement.

7. Do Not Rely Solely on the Real Estate Broker

A real estate broker plays an important role in facilitating property transactions, but the buyer should not treat the broker as the sole source of information when making a purchasing decision.

Marketing information or verbal statements provided by a broker do not replace verification of official information and documents.

The Real Estate Brokerage Law regulates brokerage activities and real estate services and establishes the rights and obligations of the parties and the broker.

The law also regulates matters relating to brokerage commissions. In principle, the brokerage commission for a sale is 2.5% of the transaction value, unless the parties to the brokerage agreement agree otherwise in writing, in accordance with the applicable provisions.

Therefore, brokerage arrangements and commission details should be clearly documented before completing the transaction.

8. Understand All Costs Before Buying Property

A common mistake is to focus on the property’s purchase price as though it were the only cost involved in the transaction.

A property purchase may involve additional costs, fees, and obligations depending on the nature of the property and transaction.

It is important to consider:

Real Estate Transaction Tax.
Brokerage fees.
Related service fees.
Financing costs, if applicable.
Valuation costs.
Property management and maintenance costs, depending on the type of property.
Any other costs associated with completing the transaction.

Real Estate Transaction Tax

According to the Zakat, Tax and Customs Authority, the Real Estate Transaction Tax is generally 5% of the value of the real estate transaction, subject to applicable exemptions and special provisions.

The new Real Estate Transaction Tax Law also entered into force on April 10, 2025.

Therefore, the applicable tax treatment should be determined before completing the transaction. Buyers should not assume that all real estate transactions are subject to identical tax treatment.

9. Do Not Make Large Payments Before Completing Due Diligence

One of the most significant mistakes a buyer can make is paying a substantial amount or signing a binding agreement before completing the necessary due diligence.

Before making any significant payment, the buyer should have a clear understanding of:

Ownership + Property Status + Restrictions + Permitted Use + Contract + Obligations + Costs + Ability to Complete the Transaction.

The higher the transaction value, the more important it becomes to conduct proper due diligence beforehand.

Ask Yourself Before Making Payment:

Have I verified the seller’s ownership?
Have I reviewed the property information?
Have I checked for restrictions and rights?
Do I know the property’s permitted use?
Have I reviewed the contract?
Do I understand the deposit terms?
Do I know all transaction-related costs?
Is there any document that I have not reviewed?

If the answer to any material question is “No,” it may be advisable to complete the necessary checks before making a final commitment.

10. Pay Special Attention When Buying an Apartment or Individual Property Unit

Purchasing an apartment or an individual unit within a building or development differs from purchasing standalone land.

The buyer should consider:

Ownership of the unit.
Unit area.
Common areas.
Shared entrances and facilities.
Parking spaces.
Usage rights.
Management and maintenance fees.
Ownership and subdivision documents, where applicable.
Obligations associated with the building or development.

The Saudi Real Estate Registration Law regulates the registration of subdivided real estate units and provides that each subdivided real estate unit located within jointly owned property has its own title registration document, subject to the applicable provisions.

Therefore, reviewing the building as a whole may not be sufficient. The buyer should also examine the specific unit being purchased and the rights associated with it.

11. Off-Plan Property Purchases Require Greater Care

If you are considering purchasing an off-plan property, you should not treat the transaction in the same way as purchasing a completed property.

The transaction may involve a development project that has not yet been completed. Therefore, the project’s documents, obligations, and associated risks should be carefully reviewed.

Key matters may include:

Developer identity and background.
Project documentation.
Relevant licenses and regulatory requirements.
Sale agreement.
Unit specifications.
Unit size.
Payment schedule.
Expected completion date.
Delay provisions.
Cancellation or termination conditions.
Warranties.
Developer and buyer obligations.

The higher the investment value or the larger the development project, the more important specialized due diligence becomes before entering into a binding commitment.

12. Do Not Confuse Development Promises with Legal Rights

An investor may hear statements such as:

“You can build a commercial project here.”

“The master plan will be approved soon.”

“You can subdivide the property in the future.”

“The area will become commercial.”

“The property value will increase after the upcoming project.”

Such statements should not, by themselves, form the basis of an investment decision.

The investor should distinguish between the current legal and regulatory status of the property and future expectations or promises.

The practical rule is:

Do not rely on an undocumented promise when an important financial decision depends on it.

If a particular use or development potential is a major reason for purchasing the property, it should be verified through the relevant documents, approvals, and requirements.

13. Check the Property’s Financial Status

In some cases, the risks associated with a property extend beyond ownership and permitted use.

Depending on the nature of the transaction, the buyer should also consider financial obligations associated with the property.

It may be useful to determine:

Whether there are outstanding amounts.
Whether there are obligations associated with the building.
Whether management or maintenance fees are outstanding.
Whether there are obligations associated with the development.
Who is responsible for expenses incurred before the ownership transfer.
Who is responsible for obligations arising after completion of the transaction.

Responsibilities should be clearly stated in the contract rather than left to verbal discussions after signing.

14. Conduct a Technical Inspection Before Purchasing

Legal due diligence alone may not be sufficient, particularly when purchasing an existing building or property.

Certain technical problems may not be apparent during an ordinary property visit, such as:

Structural defects.
Electrical problems.
Plumbing issues.
Water leaks.
Moisture.
Insulation problems.
Air-conditioning issues.
Structural modifications.
Unapproved additions or alterations that require verification.

Therefore, when purchasing a high-value existing property, an independent engineering or technical inspection may be advisable before completing the transaction.

Technical inspection and legal due diligence serve different purposes, and each addresses a different category of risk.

15. Keep All Documents and Correspondence

The buyer should maintain a complete file for the transaction from the beginning of negotiations through completion.

Depending on the circumstances, this may include:

Contracts.
Price offers.
Correspondence.
Receipts.
Bank transfer records.
Official documents.
Inspection reports.
Communications with the broker.
Written promises or commitments.
Documents related to the ownership transfer.
Any additional agreements between the parties.

Proper documentation can help establish what was agreed upon and reduce disputes concerning the details of the transaction.

16. Do Not Let a Low Price Cause You to Rush

A property priced below comparable properties may appear to be an attractive investment opportunity.

However, a low price may have several possible explanations.

Instead of asking only:

“Why is the property so cheap?”

The buyer should also investigate:

Property condition.
Ownership status.
Restrictions.
Permitted use.
Building condition.
Outstanding obligations.
Reason for sale.
Financing possibilities.
Future resale potential.

Price is an important part of the decision, but it should not be the only factor examined.

What Should You Do Before Signing a Property Purchase Agreement?

Buyers can use the following checklist:

First: Ownership

☐ Verify the owner’s identity.
☐ Confirm the seller’s legal authority.
☐ Review ownership records.

Second: Property

☐ Verify the location.
☐ Review the area and boundaries.
☐ Compare official information with the actual property.
☐ Conduct a technical inspection when necessary.

Third: Legal and Regulatory Status

☐ Check rights and restrictions.
☐ Review registered obligations.
☐ Verify the ability to transfer the property.
☐ Confirm the intended use is permitted.

Fourth: Contract

☐ Review the entire sale agreement.
☐ Confirm the price and payment terms.
☐ Understand the deposit.
☐ Confirm the transfer date.
☐ Define each party’s responsibilities.
☐ Understand the consequences of contractual breach.

Fifth: Costs

☐ Determine the applicable Real Estate Transaction Tax.
☐ Confirm the broker’s commission.
☐ Determine financing costs, if applicable.
☐ Identify any additional fees or obligations.

Sixth: Documentation

☐ Keep copies of all documents.
☐ Preserve correspondence.
☐ Keep payment records.
☐ Document any additional agreement in writing.

What If You Discover a Problem After Buying the Property?

If a buyer discovers a problem after completing the transaction, the appropriate course of action depends on the nature of the issue, the contract, the available documents, the stage of the transaction, and the specific circumstances.

The issue may relate to:

Ownership.
The sale contract.
Breach of contractual obligations.
Property information.
Defects in the property.
Third-party rights.
Permitted use.
Previously undisclosed obligations.

In such circumstances, it is important to collect all transaction documents and avoid taking action based on unsupported assumptions.

The buyer may need a legal review to determine the available rights and potential procedures based on the facts and applicable laws.

For this reason, legal due diligence before purchasing property may help identify certain problems before they develop into a dispute after the transaction has been completed.

Do You Need a Lawyer Before Buying Property?

Not every property purchase requires the same level of legal review.

However, obtaining legal advice may be particularly useful in situations involving:

High-value properties.
Commercial properties.
Land intended for development.
Off-plan properties.
Investment transactions.
Purchases conducted through an agent or attorney-in-fact.
Multiple property partners.
Complex contractual terms.
Mortgages, rights, or restrictions.
Existing disputes or claims related to the property.
Transactions involving future payments or long-term obligations.

In such cases, a legal professional can review the documents and contract and identify issues that should be addressed before completing the transaction.

How Can You Protect Yourself When Buying Property in Saudi Arabia?

The following principles summarize some of the key steps buyers can take:

1. Verify Rather Than Assume

Do not rely on verbal information regarding material matters.

2. Document Everything

Important agreements should be clear and documented in writing.

3. Conduct Due Diligence Before Paying

Do not let enthusiasm about a transaction cause you to skip the necessary checks.

4. Read the Contract

Do not sign an agreement without understanding its implications.

5. Understand the Costs

The purchase price is not always the total cost of the transaction.

6. Separate Facts from Promises

What can be officially verified is different from future expectations or informal promises.

7. Seek Professional Assistance When Necessary

This is particularly important for large or complex transactions.

Conclusion: Before Buying Property, Conduct Due Diligence First

Buying property is not simply an agreement on price, size, and location.

A real estate transaction may involve rights, restrictions, obligations, costs, and contractual terms that should be carefully reviewed before making a commitment.

Before buying any property in Saudi Arabia, make sure to:

Verify property ownership.
Review ownership records.
Check rights, restrictions, and obligations.
Compare documents with the actual property.
Confirm the intended use.
Conduct a technical inspection when necessary.
Review the sale agreement.
Understand the deposit and payment terms.
Verify the brokerage commission.
Determine applicable taxes and costs.
Keep all documents and correspondence.
Avoid relying on undocumented promises.

A sound real estate decision begins with due diligence before signing—not with trying to solve a problem after it occurs.

If the property is high-value, or the transaction involves development, commercial investment, off-plan property, or complex contractual terms, it is advisable to have the documents and contract reviewed by a qualified professional before completing the transaction.

Frequently Asked Questions About Buying Property in Saudi Arabia

What is the most important thing to verify before buying property?

Among the most important steps are verifying the property’s ownership and the seller’s legal authority, reviewing the property’s information, rights, restrictions, and obligations, and carefully reviewing the sale contract before signing.

Is a title deed enough when buying property?

A title deed or ownership document is an essential part of the transaction, but due diligence may also require reviewing additional information depending on the property and transaction, including rights, restrictions, permitted use, contractual terms, and associated obligations.

Can I buy property based on the seller’s statements?

It is better not to rely on verbal statements regarding material matters. Important information should be verified through official documents, registered information, and the written contract.

Should a property purchase agreement be reviewed by a lawyer?

Legal review can be particularly useful for high-value or complex transactions, commercial properties, off-plan properties, development and investment transactions, and agreements containing significant contractual obligations.

Who pays the real estate brokerage commission?

The brokerage commission is governed by the brokerage agreement and applicable regulations. Under the Real Estate Brokerage Law, the brokerage commission for a sale is generally 2.5% of the transaction value unless the parties to the brokerage agreement agree otherwise in writing.

How much is the Real Estate Transaction Tax in Saudi Arabia?

According to the Zakat, Tax and Customs Authority, the Real Estate Transaction Tax is generally 5% of the value of the real estate transaction, subject to applicable exemptions and special provisions that should be verified based on the nature of the transaction.

What should I do if I discover a problem after buying the property?

Start by collecting the sale contract, relevant documents, payment records, and correspondence related to the transaction. Then review the nature of the issue and the resulting rights and obligations to determine the appropriate course of action.

Is buying an off-plan property different from buying a completed property?

Yes. The risks and obligations may differ depending on the project’s status. Purchasing an off-plan property generally requires additional review of the developer, project, sale agreement, unit specifications, payment schedule, completion date, warranties, and provisions concerning delays or cancellation.

Are You Considering Buying Property? Don’t Sign Before Understanding Your Rights

If you are planning to purchase property in Saudi Arabia, do not let the price, an attractive offer, or verbal promises cause you to rush into the transaction.

Conduct due diligence, review the documents, read the contract, and understand your rights and obligations before signing.

For major or complex real estate transactions, specialized legal review can help identify issues that may need to be addressed before completing the transaction.

Suleiman Al-Omari Law Firm

Suleiman Al-Omari Law Firm provides specialized legal services in reviewing real estate sale and purchase agreements and examining documents, rights, and obligations associated with real estate transactions, through lawyers and legal and Sharia consultants, in accordance with the laws and regulations applicable in the Kingdom of Saudi Arabia.

The firm assists individuals, investors, and businesses in reviewing the legal aspects of real estate transactions, understanding contractual provisions, and identifying potential risks before completing an agreement, helping clients make clearer and more informed decisions before committing to a transaction.

📞 Consultations and Contact

+966 53 777 8130

WhatsApp: Contact Suleiman Al-Omari Law Firm for legal consultations and assistance with your real estate transaction.

Legal Disclaimer: This article is provided for general informational and educational purposes only and does not constitute legal advice for any specific case. Rights, procedures, and obligations vary depending on the facts of each transaction, the nature of the property, the contract, and the laws and regulations applicable in the Kingdom of Saudi Arabia. Specialized legal advice is recommended when necessary, particularly for high-value or complex real estate transactions.