Saudi Arabia Caps Guest Stays at 29 Days Under Its New Short-Let Licence

Saudi Arabia's new private hospitality unit rules license short-term home rentals, cap a guest at 29 days at a stretch and 90 days a year, and cost SAR 1,100.

Saudi Arabia has published a regulation governing "private hospitality units" in the Umm Al-Qura official gazette, formally licensing the short-term rental of ordinary homes and setting limits on how they may be used. Under the rules, reported by Saudi outlets on 11 and 12 September 2026, a single guest may stay no more than 29 days at a stretch in one unit, and no more than 90 days in that same unit over the life of the licence.

What the licence costs and how long it lasts

A licence is issued for a maximum of one year and carries a fee of SAR 1,100. Inspection is priced separately: the first two visits are covered, and each additional visit costs SAR 500. Operators holding permits under the previous arrangement have 90 days to convert them into licences, without an additional fee.

These are modest sums against the revenue a well-placed Riyadh or Jeddah apartment can generate on a nightly basis. The cost of compliance is not the constraint here; the stay caps and the ownership limits are.

The rule that changes the economics

The 90-day annual ceiling per guest per unit is the clause with teeth. It draws a hard line between short-term hospitality and de facto long-term letting through a nightly platform, which is precisely the substitution that has hollowed out rental stock in other Gulf and Mediterranean cities. Alongside it sits a cap of three licences per owner within a single shared building, and one active licence per title deed. Together these push the model away from an investor buying a floor of units and toward dispersed, individually-held stock.

Eligible properties are those designated for residential, agricultural, or mixed residential and commercial use, which keeps purely commercial buildings outside the scheme.

What it means for the yield picture

Glopra's market data puts Saudi Arabia's gross rental yield at 6.84% nationally and 5.77% in Riyadh, on average prices of about 1,758 dollars per square metre nationally and 1,386 dollars in Riyadh. Riyadh also carries the highest bubble-risk reading of any market in our set. Short-letting has been the arbitrage that lifted returns above those long-let figures; formalising it narrows the gap, but it also makes the income bankable, verifiable and taxable — which is what institutional capital needs before it will underwrite the segment at all.

The counterweight is honest to state: caps of this kind reduce the number of nights a unit can legally be sold, and anyone modelling Saudi short-let returns on pre-regulation occupancy is now working from a ceiling that no longer exists. This is a description of the rules, not advice on whether to buy under them.

One limitation on this report. The figures above come from two independent Saudi publications quoting the regulation as published in the official gazette; we were not able to retrieve the gazette issue itself, so the issue number and exact publication date within the gazette remain unverified by us.

Sources: Al-Bilad Daily, reporting the Ministry of Tourism regulation in the Umm Al-Qura official gazette https://albiladdaily.com/2026/09/11/; Amlak https://amlak.net.sa/110184/

Market data: Riyadh · Saudi Arabia