The True Cost of Yearly Rent in Riyadh

The advertised yearly rent is not all you will pay. Between the deposit, utility set-up, furnishing and other items that may not appear in the listing, the actual cost of the first year differs from the figure you saw. This guide breaks the true cost down item by item so you can compare offers on a sound basis.

One-off costs

The refundable deposit

An amount held and returned at the end of the contract once the unit is confirmed to be in good condition. Its amount and refund conditions vary from one contract to another — ask about both before paying, and specifically about the cases in which part of it is deducted.

Utility set-up

In unfurnished units: transferring the electricity and water meters, with the deposits and fees that come with them, plus the internet subscription and its installation fee. These amounts change from one provider to another and from year to year, so ask the landlord or the provider for a written estimate before signing rather than relying on a rough figure.

Furnishing

The largest item in the first year of an unfurnished unit. It is paid once, but when comparing you should spread it across the years you expect to stay. The full comparison is here.

Brokerage commission, if any

When you sign through a real-estate broker, a brokerage commission is paid as agreed; the legal cap is 2.5% of the contract value, and it is stated in the registered contract. Ask explicitly whether there is a commission and who pays it before approving.

Recurring costs

Electricity and water: usually the tenant's responsibility in unfurnished yearly leases, and they vary widely with unit size, consumption and the season.
Internet: a separate monthly subscription.
Shared-service fees: in some compounds — ask about them explicitly before signing.
Maintenance: whatever the contract does not place on the landlord.

Taxes and statutory fees

Residential property leasing is exempt from VAT in the Kingdom, so the 15% is not added to residential rent as it is to commercial rent. The fee for registering the contract on the Ejar platform is borne by the landlord. Even so, ask the landlord explicitly whether the quoted price includes any other fees, such as shared-service fees or routine maintenance, and ask for that to be spelled out in the contract.

Calculate the true cost of the first year

To compare two offers fairly, add up the following for each:

The advertised yearly rent.
+ the deposit (refunded later, but it ties up your cash for a year).
+ utility set-up.
+ furnishing ÷ the number of years you expect to stay.
+ recurring utilities × 12.
+ any shared-service fees.

The result can completely reverse the ranking of the two offers — especially when comparing a furnished unit with an unfurnished one.

Five questions to ask before signing

Does the advertised price include any other fees?
What exactly is the deposit amount, and what are its refund conditions?
Who pays for electricity, water and internet?
Are there shared-service or routine maintenance fees?
What is the payment schedule, and is paying in instalments possible?

Frequently asked questions

How much is the deposit usually?

There is no fixed statutory amount; it varies from one contract to another depending on the unit and the landlord. What matters is that it is recorded in the registered contract along with its refund conditions and the cases in which part of it is deducted.