Ownership & RightsOwnership Transfer
Synonyms: Conveyance، Title transfer، Transfer of title
Last updated: 2026-09-25
Short Definition
Ownership transfer is the passing of title to real estate from one owner to another by a lawful cause such as sale, gift, inheritance, bequest, partition or court judgment, completed only once documented by the Ministry of Justice or registered in the Real Estate Registry.
Overview
Ownership transfer is the passing of title to real estate from one owner to another by a lawful cause such as sale, gift, inheritance, bequest, partition or court judgment, completed only once documented by the Ministry of Justice or registered in the Real Estate Registry.
Article 655 of the Civil Transactions Law provides that ownership and other real rights pass by contract when the subject matter belongs to the transferor, while Article 657 adds that where a legal provision requires a procedure for the transfer, ownership passes only once that procedure is completed. For real estate there are two routes. Outside areas announced for cadastral registration, the conveyance (ifragh) is executed before a notary public or licensed notary under the Notarization Law, or electronically on the Ministry of Justice's Real Estate Exchange for electronic deeds. Inside announced areas, the transfer is requested on the Real Estate Registry platform: Article 13 of the Law of Real Estate Registration requires recording every disposition that creates, transfers, changes or ends a real right, including partition, bequest, endowment, inheritance, mortgage and gift, and such dispositions are neither enforceable nor judicially or administratively effective until recorded.
In practice a transfer is preceded by checking and, where needed, updating the deed and linking it to the property's real-estate ID, releasing any mortgage or obtaining the mortgagee's consent, obtaining approval of all owners and right-holders, and paying the 5% Real Estate Transaction Tax on taxable dispositions. The RETT Implementing Regulations exempt, among others, the division of an estate, a documented gift to a spouse or relatives up to the third degree, and the execution of a documented will; the state also bears the tax on an eligible citizen's first home up to SAR 1,000,000 of its value.
⚖️ Legal Basis
Ownership transfer of real estate is governed by the Civil Transactions Law (Royal Decree M/191 dated 29/11/1444H), Articles 655–657 and Article 318 on sale; the Law of Real Estate Registration (Royal Decree M/91 dated 19/9/1443H), which makes registration a condition of enforceability (Art. 13) and bars registration where the register shows encumbrances preventing disposal (Art. 20); and the Notarization Law (Royal Decree M/164 dated 19/11/1441H), under which notaries public and licensed notaries execute conveyances. The 5% Real Estate Transaction Tax applies under the RETT Law (Royal Decree M/84 dated 19/3/1446H) and its Implementing Regulations effective 10 April 2025, whose Article 3 sets out the exemptions.
💡 Practical Example
Abdullah gifts his son a villa in Dammam worth SAR 1,400,000. The gift is documented before a licensed notary and title passes to the son under a new deed; the transfer is exempt from RETT as a documented gift to a first-degree relative. Had the son re-gifted the villa within three years to someone who would not have qualified for the exemption if the father had gifted it to them directly, the exemption would have lapsed. Four years later the son sells the villa to a third party for SAR 1,500,000 on the Real Estate Exchange: both parties approve via Nafath, RETT of SAR 75,000 is paid and an electronic deed is issued in the buyer's name.
⚠️ Common Mistakes
- ✗Assuming that signing a sale contract or paying the price alone transfers title; ownership passes only once conveyance or registration is completed (Art. 657).
- ✗Attempting a transfer on an old paper deed without updating it and linking it to the real-estate ID, which blocks the conveyance.
- ✗Overlooking the release of a mortgage or recorded restriction before the conveyance appointment.
- ✗Assuming every family gift is tax-exempt; the exemption covers documented gifts to a spouse or relatives up to the third degree and lapses if re-gifted within three years to a non-qualifying person.
- ✗Using an expired power of attorney, or one that does not expressly authorise sale and conveyance.
🌍 International Differences
In the UAE, title is transferred by registration with the relevant land department, with registration fees set by each emirate. In Egypt, real-estate ownership does not pass between the parties or against third parties without registration in the real-estate publicity office. In Turkey, the transfer is signed before the land registry directorate (tapu müdürlüğü) and recorded in the register. Common-law systems distinguish the sale contract from completion by deed and its registration.
FAQs
When does ownership of real estate pass to the buyer?▾
Ownership passes by contract between the parties, but for real estate it is completed only when the legal procedure is finished, by conveyance at the Ministry of Justice or registration in the Real Estate Registry, under Article 657 of the Civil Transactions Law. Until then the disposition is not effective against third parties.
Where is a property conveyance executed?▾
If the deed is an electronic Ministry of Justice deed, conveyance is done before a notary public or licensed notary or on the Real Estate Exchange. If the property is registered in the Real Estate Registry, the transfer is requested on the Real Estate Registry platform.
Is a transfer by inheritance subject to the Real Estate Transaction Tax?▾
No. The RETT Implementing Regulations exempt the division of an estate under applicable laws and the execution of a documented will. However, a sale by the heirs to a third party is taxable at 5%.
Is gifting property to relatives tax-exempt?▾
A documented gift to a spouse or to relatives up to the third degree (parents, children, siblings, grandparents, grandchildren, uncles, aunts, nephews and nieces) is exempt. The exemption lapses if the recipient re-gifts the property within three years to a non-qualifying person.
Must a will or waqf be recorded in the Real Estate Registry?▾
Yes, in areas announced for registration. Article 13 of the Law of Real Estate Registration requires recording bequests, endowments, inheritance, partition, mortgages and gifts, which are neither enforceable nor judicially or administratively effective until recorded.
