New regulatory measures governing the relationship between landlords and tenants in Riyadh have caused confusion among some property owners, particularly those who rent their units outside the official “Ejar” platform.
Many of these landlords are now in a wait-and-see mode, trying to buy time to find loopholes in the system that would allow them to raise rental prices. But they are under growing pressure from tenants demanding that contracts be formally registered through the Ejar platform and that all parties immediately comply with the new regulations.
Some property owners, especially those operating outside the law, are reportedly seeking ways to amend or reformat lease contracts by making changes to building structures or unit sizes to circumvent the new rules.
According to several affected tenants, the main goal behind such stalling tactics is to officially double rental values for the upcoming five-year period.
A number of tenants say landlords are deliberately delaying contract registration on Ejar as a way to gain time and explore potential loopholes that would justify higher prices.
In previous months, some tenants were pressured to make payments outside the platform at the landlords’ request - a move that has now left them vulnerable, as many owners refuse to formalize contracts under the new regulations that lock in earlier rental rates.
The new regulations were introduced following directives from Prince Mohammed bin Salman, Crown Prince and Prime Minister, to implement a set of reforms aimed at organizing Riyadh’s rental market.
The measures come in response to years of steep increases in residential and commercial rents in the capital.
The Real Estate General Authority said it designed the new system in line with global best practices to clearly define the rights and obligations of both landlords and tenants.
Five-year price freeze and evasion tactics
Among the new measures is a freeze on annual rent increases for both existing and new residential and commercial leases within Riyadh’s urban boundaries for five years starting September 25. From that date, landlords will be prohibited from raising agreed rental prices during the five-year period.
Tenants are now urging authorities to enforce the registration of overdue contracts and require all payments to go through the Ejar platform, to ensure full compliance with the new rules and prevent rent hikes.
One tenant, Ahmed Dhaifallah, told Asharq Al-Awsat that his landlord has been forcing him to pay rent outside the Ejar system and has delayed registering the official contract since the new rules took effect. “The landlord is looking for loopholes to get around the law and raise the rent indirectly,” he said.
Dhaifallah revealed that the landlord recently informed him, through a real estate office, that he must vacate the property under the pretext of carrying out renovations to alter the unit’s size - a move he sees as an attempt to double the rent for the next tenant.
A similar case was reported by Khaled Al-Ghamdi, a commercial tenant, who said his landlord required rent payments to be made to a personal bank account rather than through Ejar, and later demanded an annual increase or face eviction.
Another tenant, Ghazi Mutaib, who rents an apartment in Riyadh’s Al-Malqa district, said his Ejar contract expired in early October and has not yet been renewed despite his daily follow-ups with the intermediary real estate firm.
“They keep telling me the delay is from the landlord’s side,” he said, adding that he believes the owner is trying to exploit loopholes in the new system to raise the rent.
Experts warn of penalties
Real estate specialist Khaled Al-Mobid told Asharq Al-Awsat that landlords who lease properties outside the Ejar platform face fines equivalent to one year’s rent, which is “a strong enough deterrent for those attempting to evade the law.”
He added that authorities’ decision to reward informants who report violations further discourages manipulation, since tenants themselves can report their landlords and claim the reward.
Economist Ahmed Al-Jubeir also warned that landlords who delay registering contracts on Ejar risk financial penalties if reported, stressing that attempts to alter unit sizes or modify buildings to issue new contracts at higher prices will expose violators to serious legal consequences.
“The relevant authorities are doing their part to address rising rent costs in Riyadh and stabilize both residential and commercial leases,” Al-Jubeir said. “Any form of delay or manipulation will now be met with firm fines and penalties, which should help curb further price increases.”
