Saudi Arabia’s National Housing Company (NHC), the kingdom’s state-backed real estate developer, will launch a build-to-rent program as part of government efforts to ease pressure on the capital’s rental market, property experts said.
Housing Minister Majid al-Hogail announced the initiative on Monday, saying it forms part of a package of measures designed to “rebalance” the rental sector, especially in Riyadh, after Crown Prince Mohammed bin Salman ordered tighter regulation of landlord-tenant relations.
Under the new rules, landlords in Riyadh will be barred from raising rents for five years starting Sept. 25, 2025. The freeze applies to both existing and new contracts.
Analysts say NHC’s entry into the rental market will not only boost supply but also encourage other developers to invest, helping the government meet its target of achieving “real estate balance.”
Shift to institutional renting
“The involvement of a heavyweight like NHC turns the market from individual to institutional renting,” said Khaled al-Mobid, a Riyadh-based property analyst.
“That creates a critical mass of build-to-rent projects, lifting organized supply and reducing seasonal price swings.”
He said combining the rent freeze with the injection of new units through an institutional developer would translate administrative controls into genuine market balance, easing future pressures.
Al-Mobid added that NHC-led projects, typically run under unified management with professional maintenance standards, would improve the quality of rental units, enhance tenant satisfaction and secure long-term occupancy.
Investor appeal
By offering standardized contracts, clear financing models and long-term operating structures, NHC lowers risks for private developers and draws institutional investors such as real estate investment trusts (REITs), al-Mobid said.
“That signals to the market that policy aims to expand supply and protect consumers, giving developers more regulatory certainty.”
He forecast a sharp slowdown in rent growth due to the freeze, with competition intensifying once the first wave of build-to-rent units hits the market.
If rolled out as planned over the next two years and extended through 2030, the program would narrow price bands across Riyadh, improve occupancy rates and balance supply between northern and eastern districts, al-Mobid said. It would also benefit small businesses by easing rental cost pressures, he added.
Encouraging Competition
Another property expert, Ahmed Omar Basudan, said NHC’s entry would spur rival developers to compete for Riyadh’s strong rental demand.
“Launching multiple projects will create competitive pricing that makes the capital more attractive,” he told Asharq Al-Awsat.
Basudan said the government’s measures were designed to cool soaring property costs in the capital and would help stabilize the rental market in the medium term.
