RIYADH – The Shoura Council Sunday approved a draft law containing specific regulations to run real estate offices in the Kingdom. According to the law, real estate offices must follow a unified rent contract drafted by the Ministry of Commerce and Industry. There are provisions in the contract outlining rights of landlords and tenants, as well as their obligations, besides information and personal details about them. It is also mandatory for real estate offices to keep a register with comprehensive information about the transactions of leasing, sale and the value assessment made by these offices for a period of 10 years, said Dr. Fahaad Al-Hamad, Assistant Chairman of the Shoura Council. The Shoura session was chaired by Sheikh Abdullah Al Al-Sheikh. There are 12 Articles in the draft real estate law that specify the functioning of real estate offices in extending real estate brokerage services such as marketing, sale, purchase, leasing, in addition to managing properties and assessing their values. One of the Articles specifies the commission of real estate offices. In the cases of sale or renting out, the commission should not exceed 2.5 percent. This commission should be calculated on the basis of the value of the annual rent, and there should not be any change in this even if the renting is for more than one year or the contract is renewed for any periods of time. According to the Articles, real estate offices must secure a license from the ministry to start their operation. They should also obtain a special license for the assessment of real estate values in accordance with the approved Residents Law. Another Article stipulates that the offices should follow professional ethics and criteria. Similarly, the real estate office owners and employees must meet sound professional requirements. They should provide correct and precise information to clients and those who contact them. – SG/SPA
