Buying off-plan in Saudi Arabia: how Wafi protects your money

Selling or leasing units before completion requires a licence under the Off-Plan Sale and Lease of Real Estate Projects Law, supervised by the Real Estate General Authority through the Wafi programme. The law and its Implementing Regulations took effect on 4 April 2024.^{[1, 2, 3]}

• The developer may take no more than 5% of the price as a reservation, and it must go into the project's escrow account.^[1]
• Each licensed project has one dedicated escrow account held by a licensed escrow agent (a regulated bank), not by the developer. Money is released in stages against construction progress certified by an independent engineer.^{[2, 4]}
• The sale contract must include the payment schedule, compensation for late payment, compensation for late handover including the buyer's right to terminate, the project timeline and provisions on jointly owned property.^[1]
• Compensation for the developer's delay is set by agreement but may not be less than the unit's equivalent rent as determined by an accredited valuer.^[1]

1. 01

   Check the Wafi licence

   Confirm the project is licensed for off-plan sale with the Real Estate General Authority before signing anything.^[3]

2. 02

   Pay only into escrow

   Every payment should go to the project's escrow account, never to the developer's operating account or to a broker.^[4]

3. 03

   Read the delay clauses

   Check the handover date, the delay compensation (at least equivalent rent) and your termination right.^[1]