The Ministry of Municipal, Rural Affairs, and Housing in Saudi Arabia has officially announced the implementation of amendments to the White Land Fees System starting today. This step aims to enhance the effectiveness of the system, maximize the utilization of undeveloped lands within urban boundaries, and encourage landowners to either develop or sell their lands to accelerate real estate development.
المحتويات
Key Amendments to the System
Under the new amendments, the most notable changes include:
- Increasing the fees to up to 10% of the land’s value, compared to the previous fixed rate of 2.5%.
- Imposing an annual fee on lands with an area of 5,000 square meters or more, ensuring a wider range of properties are covered under the system.
This means that the fee rate will no longer be fixed as before but will instead vary and can reach up to 10% depending on the appraised value of the land. This change creates a stronger incentive for landowners to develop or sell their lands rather than leaving them unused.
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Objectives of the Amended System
The amendments to the White Land Fees System align with the Saudi Vision 2030 objectives, aiming to:
- Increase the supply of developed land within cities.
- Curb monopolistic practices that hinder urban development.
- Stimulate real estate investment and support housing projects.
- Achieve balance in the real estate market by making more land available for construction.
Additionally, the updated system is expected to accelerate infrastructure and urban planning projects, thereby improving the quality of life in Saudi cities and meeting the growing demand for housing.
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Differences Between the Previous and New System
Previously, the White Land Fees were fixed at 2.5% of the land’s value annually, regardless of its size or location. In contrast, the amended system introduces a variable rate of up to 10% and imposes annual fees on larger plots starting from 5,000 square meters. This approach enhances the system’s impact and reduces the accumulation of undeveloped lands.
Expected Impact on the Real Estate Market
The new amendments are expected to have a direct impact by:
- Increasing the rate of land development and integration into urban projects.
- Activating the real estate market through the availability of more land for sale.
- Supporting affordable housing initiatives by boosting the supply of residential units.
- Encouraging investors to turn idle lands into projects with economic and social value.
Legal Aspects of the System
The Ministry emphasized that fee assessments are based on the market value of the land, determined by specific criteria such as location, size, and available infrastructure services. The amended system also provides mechanisms for objections and appeals to ensure fairness and transparency in implementation.
Alignment with Saudi Vision 2030
These changes directly support the objectives of the Housing Program, one of the key initiatives under Saudi Vision 2030, which aims to increase homeownership rates among citizens and balance supply and demand in the housing sector. Furthermore, the amendments promote efficient land use in urban areas and help control unplanned urban sprawl.
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Conclusion
The implementation of the amended White Land Fees System marks a significant step in reforming Saudi Arabia’s real estate sector. By introducing a flexible fee structure and expanding the system’s scope, the government aims to encourage land development, increase real estate supply, and achieve sustainable urban growth in line with Vision 2030.