Article 5 of the Saudi State Leasing of Real Estate Law
المادة 5 من نظام استئجار الدولة للعقار
The article does not count housing a government body's personnel as a need permitting leasing, except for bodies whose laws provide for housing, and the rent may not exceed the personnel's cash housing allowance.
Official text (Arabic)
This article has not been amended since the law was issued.
لا يعدّ إسكان منسوبي الجهة الحكومية من الحاجات التي تجيز لها الاستئجار، فيما عدا الجهات الحكومية التي تنص أنظمتها على إسكان منسوبيها. وفي جميع الأحوال، يجب ألا يزيد ما تدفعه الجهة الحكومية نظير الإجارة على بدل السكن النقدي لمنسوب الجهة وقت الاستئجار، أو التمديد، أو التجديد.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 5 explained in plain English
This article addresses a common question: may a government body lease housing for its employees?
The general rule: housing a government body's personnel is not counted among the needs that permit it to lease. This is connected to Article 4, which permits leasing only in urgent need.
The exception: government bodies whose laws provide for housing their personnel; these may lease for this purpose.
The financial restriction: "in all cases", that is, even in the exceptional case, what the body pays as rent must not exceed the cash housing allowance of the body's personnel member. This allowance is determined at three times:
- The time of leasing.
- The time of extension.
- The time of renewal.
So if the housing allowance rises or falls, what counts is its value at the time of concluding, extending or renewing the contract.
The result is that the body does not pay in rent more than it would have paid the employee in cash as a housing allowance. Article 6 completes the picture with the conditions that must be met in the real estate to be leased.
If you have a practical matter relating to leasing real estate to a government body, it would be best to consult a lawyer specializing in real estate cases or administrative cases.
Practical example
A government body in Abha whose law provides for housing its personnel wants to lease an apartment for one of its employees. It may do so, but the rent it pays must not exceed that employee's cash housing allowance at the time of leasing, and likewise when the contract is extended or renewed.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 5 of the Saudi State Leasing of Real Estate Law
May a government body lease housing for its employees?
Housing personnel is not counted as a need that permits leasing, except for government bodies whose laws provide for housing their personnel.
What is the maximum rent for leasing housing for an employee?
What the body pays must not exceed the cash housing allowance of its personnel member at the time of leasing, extension or renewal.
More articles on Rules for Government Leasing
- Article 3
The article requires a government body, in coordination with the Authority, to prepare an annual plan for its real estate leasing before each fiscal year and publish it, without the publication creating any obligations.
على الجهة الحكومية -بالتنسيق مع الهيئة- وضع خطة سنوية لعملية استئجارها للعقار قبل بداية كل سنة مالية، ونشرها على موقعها الإلكتروني أو أي وسيلة أخرى، وفقاً لما ت
- Article 4
The article bars a government body from leasing real estate except in urgent need, after the Authority's approval and under the Law, with controls including no unused suitable real estate and the necessary financial appropriation.
لا يجوز لأي جهة حكومية استئجار عقار إلا عند الحاجة الماسة له، وبعد موافقة الهيئة، وأن يكون الاستئجار وفقاً لأحكام النظام واللائحة، مع التقيد بالضوابط الآتية: 1-
- Article 9
The article allows two or more government bodies to lease one piece of real estate, as the Regulations specify.
يجوز لجهتين حكوميتين -أو أكثر- استئجار عقار واحد وفقاً لما تحدده اللائحة.
- Article 20
Government agencies lease property outside the Kingdom under rules issued by the Authority's board in coordination with relevant bodies, balancing the interest of buying versus leasing.
يكون استئجار الجهات الحكومية للعقار خارج المملكة وفقاً لضوابط يصدرها المجلس بالتنسيق مع الجهات ذات العلاقة، وتتضمن تلك الضوابط التوازن بين مصلحة الشراء أو الاست
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.