The new rental law protecting the rights of both tenants and landlords is scheduled for signing Saturday.

The law, which requires landlords to enroll in a system that keeps a history of tenants’ rent payment, allows property owners to run background checks and identify tenants with bad rental histories.

Landlords have the option of enrolling in the new system, which also requires them to charge tenants monthly instead of the current common practice of having tenants pay quarterly, semiannually or annually.

The Ministry of Housing and Al-Elm Company will sign an agreement to keep a database, a local daily reported. The system will connect real estate offices with a network that has the credit details of the tenants.

The new system will be free of charge and will be unified throughout the Kingdom. However, registration will be optional for real estate offices. The system will help track down tenants who delay or do not pay rent for apartments, offices and shops on time.

The law comes at a time when the real estate market is heavily unregulated and is the first step in protecting the rights of tenants and property owners who are often forced to go to court to force the other party to comply with the terms of a lease.

Bandar Rawas, a real estate consultant and a businessman, said that it was a good move if implemented at the right time. “I don’t think it will be implemented before at least a year,” he said.

In case of a default from the tenant, the landlord moves the General Court or the local governorate. “Every governorate has a real estate committee. Usually, it takes one month for the case to be settled. If the tenant does not pay within that month, then he signs a pledge to pay within another month,” Rawas explained.

However, if the tenant still falters there is no alternative other than his eviction. “I can put the tenant in prison but that won’t solve the problem. I won’t get my money back,” he said.

Landlords have been waiting for the launch of the new system as for years they have been calling for a law to protect their rights. “I’m not sure when it will be introduced, but it’s good to hear that it is on the table,” said Mohammed Abdullah, a landlord.

However, he said that there is a "shomous" system at the Ministry of Interior, which has a database for tenants. “Shomous is used by the Ministry of Interior as a database to track criminals or suspects around the Kingdom and real estate offices usually register the tenants through the landlord,” he said.

Abdullah said it was good to have a system but as a landlord, he still awaits a unified contract. “The housing problem we have now needs a facelift in terms of setting new laws, implemented straight away, to protect the rights of both parties,” he added.

The new system is expected to boost the real estate market and attract young investors. However, it is still not clear whether the unified contract will be introduced or not. The unified contract was suggested to the Shoura Council and it is still being studied. It is expected to include rent control measures to prevent random rent increases by landlords.