Foreigners' Freehold Ownership Law for Real Estate in the Sultanate of Oman

The Foreigners' Property Ownership Law in the Sultanate of Oman is a system of royal decrees and comprehensive executive regulations that specify: who has the right to own, where, under what conditions. For those studying the regulation of foreigners' property ownership in Oman from a purely legal standpoint—not "where to buy" but "what the law actually states"—this guide explains the governing texts, associated fees and taxes, official registration procedures, and penalties for violations with updated legal precision.

Foreigners' Property Ownership Law in the Sultanate of Oman

The regulation of foreigners' property ownership in Oman is based on three integrated legislative levels:

- First - The Omani Civil Law: the general reference for regulating contracts between individuals and companies, it defines contracting mechanisms, reciprocal obligations, and contract termination conditions upon breach; it applies equally to real estate sale contracts as well as other contracts.

- Second Level - The Real Estate Registry Law: This law operated under Royal Decree No. 2/98 for 28 consecutive years until Royal Decree No. 56/2026 was issued, establishing an entirely new real estate registry law, which cancels the old system and expands the scope of property registration in the names of non-Omanis beyond the exclusivity of integrated tourist complexes only. This recent update is the most important legislation in the past three decades in this area, and its executive details are still pending issuance at the time of writing this guide.

- Third Level - The Direct Foreigners' Ownership Decree: Royal Decree No. 12/2006 allows non-Omanis to own residential units within integrated tourist areas (ITCs) under specific conditions, and is the most cited text when discussing the Foreigners' Property Ownership Law in the Sultanate of Oman specifically.

Alongside these three levels, the same system includes Royal Decree 29/2018 and its executive regulations (Ministerial Decision 292/2020), which define areas prohibited to foreigners for security, heritage, and agricultural reasons, and Royal Decree 20/2000, which pertains to a different and broader ownership system for GCC citizens.

What Does the Foreigners' Property Ownership Law Guarantee in Oman?

The law grants the foreign investor full ownership of the property (freehold) with the right to sell, lease, and inherit without time restrictions. It also allows the owner and their family members to apply for long-term residency linked to the ownership period, a right recently reinforced by Royal Oman Police Decision No. 87/2026 which introduced the "Owner Residency" granted without a sponsor to any foreigner holding an official ownership certificate, even before completing final registration procedures for the unit.

Overall, this legal framework aims to strike a precise balance: encouraging foreign real estate investment that supports the national economy while fully protecting the rights of all parties involved (developer, owner, and tenant) within a transparent and incentivizing legal environment.

Fees and Taxes Related to Foreigners' Property Ownership

One of the most distinctive features of the Foreigners' Property Ownership Law in Oman compared to other regional markets is the limited tax burden on the foreign owner:

- Real Estate Registration Fees: a mandatory fee paid when completing any sale or purchase transaction, its value varies according to the property value, and it is a fundamental documentation procedure to legally prove ownership.

- No Personal Income Tax Until 2028: Currently, Oman imposes no personal income tax including rental income. According to Royal Decree 56/2025, a limited personal income tax system of only 5% will be activated starting January 2028, targeting individuals whose annual income exceeds 42,000 Omani Riyals, while more than 99% of residents remain exempt from this tax, this is a future development worth monitoring for long-term investment decisions, not a current tax reality.

- No Capital Gains Tax: Oman does not levy tax on profits earned from reselling property at a higher price than its purchase price, enhancing attractiveness for long-term investment.

- Additional Fees: may include property valuation costs or fees related to ownership transfer services, varying according to the competent authority and specific transaction.

Also read: Obtaining Residency Through Property Ownership in Sultan Haitham City

Legal Procedures for Property Registration Under the Law

Property registration is a mandatory step required by law for all parties to officially document ownership and protect it from any future disputes. The basic steps are:

1. Submitting the Registration Application: submitted to the Ministry of Housing and Urban Planning (the competent authority under the new real estate registry system), accompanied by all required legal documents.
2. Verification of Document Validity: the competent authority reviews all documents to ensure their compliance with the law.
3. Official Contract Signing: the sale and purchase agreement (SPA) is signed before authorized officials to guarantee its legal effect.
4. Issuance of Ownership Certificate: an official certificate proving ownership is issued after completing all procedures, and this document is fundamental for any subsequent process, including applying for residency linked to the property.

In special cases such as inherited properties, submission of legitimate inheritance documents is required. In cases of real estate partnerships, precise documentation of partnership details and each party's shares must be completed before proceeding with registration.

Fines and Penalties for Violating the Foreigners' Property Ownership Law

Omani law imposes specific penalties to ensure compliance by all parties and to protect the stability of the real estate market:

• Fines for Non-Registration: those who do not register their property within the legal deadline are subject to financial fines that may increase with the length of the delay.
• Penalties for Land Encroachment: encroachment on land owned by others or government land exposes the violator to financial fines and obligates them to remove any unauthorized construction at their own expense.
• Penalties for Violating the Allowed Foreigners' Ownership Scope: anyone proven to own property in an area prohibited for foreigners under Decree 29/2018 is required to transfer ownership to an Omani citizen within a specified correction period (which has been two years in its latest application) and does not benefit from any rights granted by the ownership law until the transfer is completed.
• Penalties for Real Estate Fraud: include imprisonment and heavy financial fines, serving as a legal deterrent to protect the rights of owners and investors from sham contracts or sale of properties not actually owned by the seller.

Also read: Foreigners' Property Ownership Conditions in the Sultanate of Oman 2026: June Updates

Real Estate Fraud Cases and How to Legally Prevent Them

Real estate fraud is an ongoing challenge in any rapidly growing real estate market. Its most prominent recorded forms are legally invalid sales contracts, fake projects without official licenses, or deceptive practices such as selling property not actually owned by the seller.

For legal prevention of these risks, three essential steps are recommended: verifying the authenticity of all documents through official authorities directly (Ministry of Housing and Urban Planning) before any payment; dealing exclusively with officially licensed marketing and real estate brokerage companies such as Imtilak Global Sultanate of Oman; and consulting a lawyer specialized in Omani real estate law before signing any final sale contract, especially in cases of remote purchase without personal in-person inspection of the property or project.

How Can Imtilak Global Assist You Legally in Ownership?

Dealing with a multi-level legal system: Civil law, new real estate registry system, direct ownership decree, and separate prohibition and residency regulations requires a reference that keeps pace with every legislative update as soon as it is issued. Therefore, at Imtilak Global, we monitor every amendment issued by official bodies and help our clients understand its impact on their decisions before any step, starting from verifying project licensing, examining contracts, all the way to completing registration and residency procedures after purchase.

If you need a free real estate consultation about the Foreigners' Property Ownership Law in the Sultanate of Oman before any purchasing decision, contact our team directly.

Frequently Asked Questions

What happens legally if the property is not registered after purchase?
The owner is subject to escalating financial fines with the length of delay, in addition to lacking full legal protection of their rights without official registration.

Can a foreigner sell their property immediately after purchase?
That depends on the type of ownership; in the case of usufruct rights in some projects, the property cannot be disposed of until four years from the contract date have passed, except for those whose official residency in the Sultanate has ended. Full freehold ownership is not subject to this time restriction.

What is the legal penalty for owning property in an area prohibited to foreigners?
They are required to transfer ownership to an Omani citizen within a specified correction period and do not benefit from any rights granted by the foreigners' ownership law until completion of that transfer.