Oman property ownership for foreigners: Laws, rights, and requirements every foreigner should know

Since 2006, Oman has gradually opened up its real estate market to foreign investors through a regulated legal framework. From Integrated Tourism Complexes (ITCs) to usufruct rights and commercial ownership, the system allows non-Omanis to buy and invest in property under specific conditions. This guide provides a comprehensive overview of where and how foreigners can acquire property in Oman, the associated rights and obligations, potential risks, and legal documentation requirements.

Understanding foreign ownership rights in Oman
Foreigners are permitted to own real estate in Oman only within designated zones called Integrated Tourism Complexes (ITCs) and select commercial buildings licensed by the Ministry of Housing and Urban Planning (MOHUP). The legal basis for this was introduced in Sultani Decree 12 of 2006, which formally allowed foreign nationals and companies to acquire usufruct rights over land in ITC areas.

Key features of ITCs:

• ITCs are master-planned developments that combine residential, commercial, and tourism components.
• Foreign nationals can acquire 100% ownership rights over both residential and commercial properties within ITCs.
• Ownership is provided via usufruct, a long-term leasehold right that can last up to 99 years.
• Purchasers must begin construction on undeveloped plots within four years of acquisition. This deadline may be extended at the discretion of the Ministry. If not met, the land can be repossessed and auctioned by the MOHUP.

Existing and upcoming ITC projects in Oman include:

• Al Mouj Muscat
• Shangri-La’s Barr Al Jissah Resort and Spa
• Muscat Hills
• Saraya Bandar Jissah
• Salalah Beach Resort
• Muscat Bay
• Jebel Sifah

Sale of residential units:

• Once a developer completes a project within an ITC, they are authorized to sell units to both Omani and non-GCC nationals.
• These sales are granted title absolute, but require an upgrading fee paid to the Ministry.
• If a developer fails to meet the terms of the development agreement, the government reserves the right to take over the project.

Oman's usufruct rights outside ITCs – Expanded access in Muscat
In a significant policy move in 2020, Oman extended property rights for expatriates by introducing a usufruct scheme allowing ownership outside traditional ITCs, particularly in and around Muscat. These rights are similar to leaseholds, granting the holder the ability to use, live in, or earn income from the property over a specified period.

Eligibility requirements:

• Applicants must be 23 years or older.
• Must have resided in Oman for a minimum of 2 years.
• Property must be located in multi-storey buildings with four or more floors.
• Buildings must be located within zones licensed by the Ministry.

Restrictions:

• A buyer may only purchase one unit under this scheme.
• No more than 40% of units in a building can be owned by expatriates.
• No more than 20% of the units can be held by nationals of a single foreign country.

Financial requirements:

• Minimum property value must be:
• OMR 45,000 in Muscat Governorate
• OMR 35,000 in other governorates

Transfer and inheritance:

• Usufruct rights are renewable up to 99 years.
• Rights can be sold, or passed on to legal heirs.

Goal of the scheme:

• Diversify Oman’s economy
• Attract long-term foreign investment
• Align with property ownership norms in neighboring GCC countries

Legal framework, risks, and documentation for foreign buyers in Oman
Engaging a qualified Omani lawyer is highly recommended when purchasing property. Legal professionals assist in verifying ownership, ensuring compliance, and navigating the permit and registration process.

Key legal documents required:

Purchase Agreement (Akad al-Shei) – notarized and legally binding

Title Deed / Deed of Sale – issued by relevant authority

Registration Form – with Ministry of Housing

Certificate of Residence – from Ministry of Interior

Identification – valid passport or Omani ID

Bank Statement – proving financial capacity

Survey or Site Plan – of the property

Environmental Permit – from Ministry of Environment and Water

Building Permit / Zoning Certificate – from local municipality

Ownership Certificate – from Ministry of Economy

Risks and limitations for foreign buyers:

• No land ownership: Foreigners lease land from the government, usually via usufruct, not freehold.
• Lease renewals: Many leases are renewable every 10 years, subject to government discretion.
• No real estate law: Oman currently lacks a unified real estate code, so legal rights and obligations must be clearly laid out in contracts.
• Mortgage limitations: Although technically possible, mortgages for foreigners are restricted and not widely available.

Banks offering mortgages to foreigners:

• Bank Muscat
• National Bank of Oman (NBO)
• Bank Dhofar

Mortgage terms:

• Loans are subject to eligibility criteria including residency status and income proof.
• Interest rates range between 3% and 7% for 20-year terms.

Restrictions on ownership and regional limitations in Oman
Despite the opportunities available, Oman enforces strict zoning laws regarding foreign ownership. Non-Omanis are prohibited from owning property in certain sensitive or strategically important areas.

Restricted zones include:

• Musandam
• Buraimi
• Dhahirah
• Wusta
• Liwa
• Shinas
• Masirah
• Jabal Akhdar
• Jabal Shams
• Areas near military bases, archaeological sites, historical structures, and agricultural land

These restrictions aim to protect national security, heritage, and agricultural sustainability.
FAQs

Q. Can foreigners own property in Oman?
Yes, but only within designated Integrated Tourism Complexes (ITCs) or under specific usufruct schemes approved by the government.

Q. What is a usufruct right?
A usufruct right allows you to use and benefit from a property for a fixed period, without owning the land itself.

Q. Can foreigners get a mortgage in Oman?
Yes, some banks offer mortgages to foreigners, but eligibility depends on residency and financial criteria.

Q. How long do foreigners have to build on undeveloped land in ITCs?
They must build within 4 years of purchase, or risk losing the land.

Q. Are there areas where foreigners cannot buy property in Oman?
Yes, ownership is restricted in regions like Musandam, Jabal Akhdar, and areas near military or heritage sites.