MULKIYA · GUIDES
The 2.5% Brokerage Cap: What You Pay When You Engage a Broker
Reviewed against the official register · Updated 2026-07-30
A broker's commission in Saudi Arabia is capped by law at 2.5% of the price, plus 15% VAT on the commission, and it is due only if you engage one.
A cap, not a tariff
The Real Estate Brokerage Law caps a broker's commission at 2.5% of the price. That figure is a ceiling, not a fixed charge. You may agree less, and on a large purchase you should try. The commission is payable only when a broker is actually engaged, and it is paid by whichever side engaged them. A buyer who finds a property through a broker pays for that broker's work; a seller who lists through one pays for theirs. No broker in the deal means no brokerage line at all.
VAT on the commission, not the property
The 15% VAT applies to the commission itself, not to the price of the property. Take a SAR 2 million apartment. At the cap, the commission is SAR 50,000, and the VAT on it is SAR 7,500, so the full brokerage line is SAR 57,500. Agree 2% instead and the line is SAR 46,000 in total. The point matters when you negotiate: the cap and the VAT bound what a broker may charge, and anything quoted above them has no legal basis.
When the line disappears
Buy direct from a developer and there is no broker in the deal, so no commission and no VAT on one. Inside the designated zones, developers sell new units directly, and the purchase settles through the official process like any other. Mulkiya sits on your side of the line. It is not the broker and never the seller, it takes no commission and no success fee, and the listings you see come direct from developers. Your costs do not change because you came through the platform.
How to read a quote
The brokerage line is separate from the 5% real-estate transaction tax, which is a tax on the price, legally the seller's liability and commonly priced into the deal. It is also the only service charge on a purchase with a verified legal cap. Beyond the tax and a capped commission, no other government fee on a purchase is verified, so question any extra line item you are shown. Ask for the commission as a percentage of the price, check it against the 2.5% cap, and check that VAT is charged on the commission alone.
The honest next step
Brokerage is one line in a short cost list, and the cost list only matters once you know you can buy. Eligibility turns on your buyer class, your residency status and, for Makkah and Madinah, one more question. Mulkiya's eligibility check asks seven questions and returns an answer from a deterministic rules engine, cited to Royal Decree M/14 and Council of Ministers Decision 43. Run it before you negotiate with anyone.
Is the 2.5% brokerage fee mandatory?
No. It is a legal cap, not a fixed charge, and it applies only when a broker is engaged. Buy direct from a developer and the line disappears. VAT of 15% applies to the commission itself.
Does the 15% VAT apply to the property price?
No. The VAT applies to the brokerage commission, not to the property price. On a SAR 2 million property with a maximum commission, the VAT is SAR 7,500, charged on the SAR 50,000 commission.
Who pays the commission, buyer or seller?
Whichever side engaged the broker. A buyer's broker is paid by the buyer and a seller's broker by the seller. If no broker is engaged, neither side pays.
Does Mulkiya charge a commission or a success fee?
No. Mulkiya is not the broker and not the seller. It takes no commission and no success fee, so your purchase costs do not change because you came through the platform.