Guides

Mortgages in Saudi Arabia: A Guide for Buyers in 2026

Published 7 August 2026 · Prop966 Editorial

Mortgages in Saudi Arabia work differently from conventional home loans in two ways that matter before you start shopping: the financing is Sharia-compliant, so there is no interest in the Western sense, and the deposit you need depends heavily on whether you are a Saudi citizen, a resident expatriate, or a non-resident buyer. This guide covers what each group can realistically expect.

The two Islamic financing structures

Saudi home financing does not charge interest. Instead, banks use one of two asset-based structures, and the difference affects who holds title during the term.

Murabaha (cost-plus sale). The bank buys the property and immediately resells it to you at an agreed marked-up price, payable in fixed instalments. You own the property from the start and owe the bank a fixed total. Because the price is agreed at the outset, your obligation is known in full on day one.

Ijara (lease to own). The bank buys and owns the property and leases it to you for the term, with ownership transferring to you at the end. Payments cover the lease, and the structure can allow more flexibility in some arrangements.

Ask which structure a quoted product uses, and ask for the total amount payable over the full term rather than just the monthly figure. Comparing monthly payments alone hides differences in term length and total cost.

Deposits and loan-to-value limits

The Saudi Central Bank (SAMA) sets loan-to-value caps for residential financing. For Saudi citizens buying a first home, financing can reach up to 90% of the property value, which means a deposit of 10%.

Foreign buyers face a different reality. Deposit expectations reported across the market in 2026 run from roughly 25% to 35% for resident expatriates, and higher again for non-residents where financing is available at all. The strongest applicants with long tenure, high income and an established banking relationship sit at the better end of that range.

Plan your budget from the deposit up, not the monthly payment down. On a SAR 1.5 million home, the difference between a 10% and a 30% deposit is SAR 300,000 of cash you either have or do not.

What expatriates need

If you hold a valid Saudi residence permit, home financing is genuinely available. Several major Saudi banks run explicit expatriate home finance products. The usual requirements are:

• A valid iqama with meaningful remaining validity
• Salary transfer to the lending bank, which is often the deciding factor
• Employment tenure, with lenders preferring applicants past probation and with a stable employer
• Saudi Central Bank approval for financing to a non-Saudi applicant
• A debt-to-income ratio within the bank’s limits, counting existing obligations including car finance and credit cards

The practical sequence is: pick your bank based on where your salary lands, get a pre-approval in principle, and only then shortlist properties. Doing it the other way around is how buyers end up committed to a reservation they cannot finance.

What non-residents should expect

Most retail banks in the Kingdom do not offer mass-market mortgages to buyers with no Saudi residency. In practice the realistic routes for non-resident purchasers are:

1. Buy with cash, which is how most international purchases in newly opened markets happen in the early years, or
2. Establish residency first, then finance as a resident.

Since foreigners became able to buy in designated ownership zones in January 2026, this is a fast-moving area and bank appetite may broaden. Treat any general statement about non-resident lending as a starting point and confirm directly with banks. The ownership framework itself is covered in our guide to foreign property ownership in Saudi Arabia.

Financing an off-plan purchase

Off-plan adds a wrinkle: you are financing something that does not exist yet, while paying in instalments tied to construction.

• Some lenders will finance off-plan against a Wafi-licensed project, since the escrow structure and progress verification reduce their risk too. Licensing status is therefore a financing question, not only a safety question. See how Wafi escrow works.
• Confirm when the financing draws down relative to your developer payment schedule. A mismatch between the two calendars is the most common off-plan financing problem.
• Remember the handover-stage costs. Many plans back-load 30% to 40% of the price to completion, and the transaction tax lands then too. Our breakdown of the real cost of buying property sets out the full list.

Government support for Saudi buyers

Saudi nationals have access to subsidised routes that non-citizens do not, principally through the Sakani housing programme, which pairs eligible citizens with subsidised financing and, in many cases, with units delivered by state-backed developers. The programme is central to the Vision 2030 home-ownership target and is a significant reason why so much new residential supply is arriving in and around the major cities.

Questions to ask before you sign

• Is this Murabaha or Ijara, and who holds title during the term?
• What is the total amount payable over the full term?
• What deposit does this specific product require for my residency status?
• What are the early settlement terms if I want to pay off or sell before the end?
• Are there arrangement, valuation or takaful costs on top?
• Will this lender finance an off-plan purchase in the project I am considering?

Get the answers in writing. This guide is general information rather than financial advice, and lending criteria change: confirm current terms with the bank and check the framework published by the Saudi Central Bank before committing.

Once financing is settled, the rest of the purchase sequence is in our step-by-step off-plan buying guide.

References

Details in this guide are drawn from official Saudi regulatory sources (SAMA, REGA) and published lender terms, current as of August 2026.