Authorities in Saudi Arabia have introduced a stringent new penalty system that makes rental violations significantly more expensive, particularly targeting unlawful rent increases and contract breaches. This move aims to reinforce tenant rights across the market, with a strong focus on Riyadh.
A Clear Penalty Ladder for Landlord Violations
Under a formal schedule attached to the Labor Law, violations governing rental relationships are now clearly classified. The system imposes fines that increase sharply for those who repeatedly break the rules. One of the most serious offenses is raising the total rent for residential, commercial, or vacant properties against the regulations.
The penalties are designed to escalate in distinct stages. A first-time offense will result in a fine equal to two months' rent. If the same violation is repeated, the financial penalty jumps to six months' rent. For continued non-compliance, landlords face a hefty penalty equal to a full year's rent. Crucially, in all instances, property owners are required to both pay the fine and correct the violation they committed.
Penalties for Failing to Register on Ejar Platform
The new schedule also specifically addresses failures to register rental contracts on the official electronic rental services network, known as Ejar. The enforcement process begins with an official warning and an order to correct the oversight. If the issue is not resolved, a second offense can lead to a fine of up to three months' rent. A third offense sees the penalty double to six months' rent.
Similar financial penalties apply in Riyadh when landlords refuse to renew rental contracts without a valid reason or forcibly try to evict tenants without legal justification. This strengthens protections for tenants against arbitrary eviction or sudden contract termination.
Tenant Rights and Compensation Remain Paramount
The decision firmly states that imposing these administrative penalties does not cancel out the right of the harmed party to seek additional compensation. Tenants who suffer financial or other losses due to a landlord's violations can still independently pursue legal claims for damages, separate from the fines paid to authorities.
This framework is part of a broader rent control initiative in the capital. It builds upon an earlier Cabinet decision that approved provisions to regulate the rental relationship. That previous decision included a significant measure: suspending annual increases in the total rent value for both residential and commercial contracts in Riyadh for a five-year period.
Together, these rules are designed to bring stability to the rental market, curb unlawful and exploitative practices, and provide tenants with clearer, stronger protections. They also set firm legal and financial expectations for landlords, ensuring a more balanced and transparent housing ecosystem.
