You have a residential building you want to lease to a business as collective housing, or your business needs a housing licence for its workers now that compliance is tied to the commercial registration? Converting a building into licensed collective housing is not just signing a lease; it is a separate licence with location, technical and safety requirements, an engineering inspection and a fixed term. Here are the steps to convert a residential building into collective housing as published on Balady, along with what to prepare before you start and mistakes that delay licensing.
The Official Steps on Balady
- Log in to Balady and choose the applicant's capacity.
- Locate the housing to be licensed on the map.
- Review the municipal requirements for the chosen location and confirm compliance.
- Enter the property details and the estimated capacity.
- Assign the application to an engineering office for inspection.
- Specify the ownership type (owner or tenant), and upload photos of the property and the lease if any.
- Confirm the data and submit the application.
- The engineering inspection takes place within two working days of agreeing the cost.
- After approval, the licence is printed from the requests and permits section.
For the full picture of the mandate and the Qiwa link: Collective housing requirements: the complete guide.
Before You Start: Is the Building Suitable?
- The location must meet the location requirements, including the distance from schools and hospitals.
- The number of rooms and bathrooms affects the approved capacity.
- Safety, ventilation and lighting requirements. Read: Civil Defense requirements for collective housing.
- The building's own regulatory status: a building permit and conformity.
Checklist to Prepare the Building Before Inspection
| Item | What to confirm |
|---|---|
| Exits | Not locked, clearly marked and free of obstructions |
| Alarm and firefighting | Working smoke detectors and valid extinguishers |
| Electricity | No exposed wires or improvised connections |
| Kitchens | Adequate ventilation and safe gas connections |
| Bathrooms | A suitable number for residents, clean and ventilated |
| Rooms | A number of beds proportionate to the area |
How Is Capacity Calculated?
Capacity is set based on the area of the building or compound and the number of rooms and facilities under the approved requirements. Enter a realistic estimated capacity in the application; overstating it will be exposed at inspection and the application returned, while understating it may not cover your workforce registered on Qiwa.
For Owners: Leasing as Collective Housing
- Agree with the tenant business who applies for the licence and who bears the cost of preparations.
- State in the lease the maximum capacity allowed and responsibility for exceeding it.
- Monitor the building's condition, as heavy use increases maintenance needs.
Mistakes That Delay Licensing
- Entering a capacity larger than the areas allow.
- Existing violations in the building itself. Read: A building without a permit.
- Not preparing the building before the inspection.
- Choosing a location that fails the location requirements and discovering it after signing the lease.
Frequently Asked Questions
How long is a collective housing licence valid?
One year per Balady, renewed to continue.
Can a whole residential compound be licensed?
Balady defines a residential compound as a group of independent buildings within a fenced area, one of the categories of collective housing.
Can a villa be converted into collective housing?
If it meets the location, technical and safety requirements, and the site's use allows it. Read: Dividing a villa.
Who pays for the engineering inspection?
The cost is agreed with the office assigned the application, and the inspection takes place within two working days of agreement.
What if the application is rejected after inspection?
The comments are addressed and the application resubmitted; preparing in advance saves time.
Related Guides
How Abak Engineering Consultancy Helps
Abak is an accredited engineering office in Riyadh that assesses your building before conversion, sets a realistic capacity and the work required, and handles the licensing procedure. Learn about our collective housing licensing service, or contact us.
Regulatory information is based on the Balady platform and the Ministry of Municipalities and Housing, and procedures may be updated by the competent authority. Last reviewed: October 2026.
