Saudi Ministry of Municipalities and Housing proposes new land development regulations

The Saudi Ministry of Municipalities and Housing has released a draft proposal to regulate the development of lands designated for housing support programs. The initiative aims to organize investment mechanisms where municipal lands are developed in exchange for essential services or the construction of residential units for developmental housing beneficiaries.

The proposed regulations outline several mechanisms for investors to recover development costs through public competition. One method involves granting investors usufruct rights to a percentage of the developed land for a specific period, with competition based on the shortest duration. Another method allows for the transfer of land ownership to the investor, capped at 20% of the total net area after development, though exceptions may be made through agreement between the Ministers of Municipalities and Housing and Finance.

Certain areas are excluded from ownership transfers, including commercial street plots, public utility lands, and coastal or beachfront properties. The Ministry will specify payment mechanisms and land transfer details within project-specific terms and conditions, ensuring that land transfers are linked to actual development progress and completion levels.