Regulations for correcting rental violations: Procedures of the General Authority for Real Estate
In a regulatory move aimed at enhancing transparency and reliability in the Saudi real estate market, the General Authority for Real Estate a set of new regulations to rectify violations of the provisions governing the landlord-tenant relationship. These decisions come as part of the Authority's ongoing efforts to regulate the sector and raise the level of compliance with applicable laws and regulations.
The context of real estate regulation and the importance of the electronic network
These regulations fall within the Kingdom's comprehensive real estate sector strategy, which aims to govern real estate transactions and reduce litigation. The Authority has been working for years to develop the legislative environment, particularly through the Ejar network , which has become the official framework for documenting contracts and protecting the rights of all parties. This new step complements the ongoing digital and regulatory transformation, as the real estate market is no longer based on randomness but is now governed by precise regulations that guarantee the rights of landlords, tenants, and real estate brokers alike.
10-day grace period and standard procedures
The General Authority for Real Estate clarified the procedures for addressing violations, emphasizing that failure to rectify the violation within the specified legal period, which does not exceed ten days from the date of notification, grants the Authority full power to take the necessary regulatory measures to enforce compliance. These measures include the following:
- Adjusting the financial value: The right to adjust the total wage value in accordance with regulations or to correct material errors in the contract.
- Contract renewal is mandatory: obligating the parties to renew the lease agreement to be in accordance with the provisions adopted in the electronic rental services network.
Protecting the "good faith" tenant and the legal process
In its commitment to protecting those not at fault for the violation, the legislator has established specific scenarios for situations where rectification is impossible. For example, if the property is leased to a new tenant acting in "good faith" (i.e., unaware of any prior dispute or violation), the authority will not automatically terminate the new lease. Instead, the dispute will be referred to the competent court . This procedure aims to enable the judiciary to adjudicate the dispute based on evidence and documentation, thus ensuring justice for all parties.
Expected impact on the real estate market
These regulations are expected to contribute to a qualitative shift in the stability of the rental market, through:
- Enhancing investor confidence: where investors and owners feel there is a clear regulatory framework protecting their assets and returns.
- Reducing conflicts: Clarity in procedures and timeframes reduces personal interpretations that often lead to long-term disputes.
- Preserving rights through compensation: The Authority affirmed that the application of these administrative controls does not negate the right of those affected to resort to the judiciary to claim compensation for any material or moral damages they suffered as a result of the violation.
These regulations will come into effect from the date of their adoption, which requires all those involved in the rental sector to review their contracts and ensure their compliance through official channels to avoid penalties or mandatory corrective measures.
