14/01/2026
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14/01/2026
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KUWAIT CITY, Jan 14: The Union of Real Estate Institute for Private Training has released its first knowledge guide, titled “A Guide to Sharia-Compliant Principles for Real Estate Management.” It is aimed to strengthen and disseminate specialized knowledge in the real estate sector and to develop national talent by promoting best practices. Its core objective is to reinforce adherence to Sharia values and ensure responsible real estate management, with all professional activities fully aligned with the principles and objectives of Islamic law. The guide carefully outlines significant Sharia-compliant principles and jurisprudential rules relevant to real estate management.
Its content is based on the Quran, Sunnah, and scholarly Islamic opinions, while also incorporating the best contemporary practices in the field. The Institute emphasizes that the guide fulfills its mission to educate and support all stakeholders in the real estate sector including owners, managers, developers, and professionals, by enabling them to operate according to sound Sharia principles. This effort is seen as vital for the sector’s growth, stability, and for building trust both locally and regionally. The publication is organized into four sections:
- “Principles of Contracting in Islamic Law”
- “Real Estate Management Contracts and Their Sharia-Compliant Regulations”
- “Sharia-Compliant Regulations for Contractual Relations with Tenants”
- “Sharia-Compliant Regulations for Real Estate Transactions” The guide marks the first in a planned series of scholarly and training publications from the Institute.
This initiative reflects the belief that knowledge is a cornerstone for developing the real estate market and ensuring professional sustainability. The guide is available for download on the Real Estate Union website. According to the guide, real estate management is a key aspect of real estate investment. It includes a range of activities and tools, such as buying, selling, developing, and reselling properties, as well as leasing and operating them.
Importantly, real estate management is not limited to generating rental income or profit from resale, but it also aims to preserve the overall value of the property. A real estate management contract is defined as a formal legal agreement that governs the relationship between the parties, protects their rights, and ensures the effective management of the property.
The parties involved are: The First Party - The owner of one or more residential, commercial, or investment properties. This may be a natural person or a legal entity, such as a government institution, private business, endowment, or other organization.
The Second Party - The property manager, typically a real estate management company.
Sharia-compliant guidelines for real estate auctions
1. All procedures in real estate auction contracts, including written documentation, organization, and administrative or legal regulations, must comply with the provisions of Islamic Sharia.
2. There is no Sharia objection to the auction organizer requesting a deposit from participants. The organizer must return the deposit to any participant whose bid is unsuccessful, while the deposit is deducted from the final price for the winning bidder.
3. Collecting an entry fee for the terms and conditions booklet is permissible under Sharia, provided it does not exceed the booklet’s actual cost, as it is considered payment for the booklet itself.
4. Bidding wars are prohibited. This refers to artificially inflating the price of an item by someone who has no intention of purchasing it, often with the seller’s complicity, making both parties accountable for sin.
5. Conflicts of interest must be avoided. A real estate broker may not sell a property at auction and then attempt to purchase it for themselves, a partner, or a parent or subsidiary company.
6. Bidders may not collude to withdraw from bidding to manipulate the price and acquire a property at a lower value.
7. It is permissible for two or more parties to agree to withdraw from bidding so that one can win, provided they do not hold significant influence in the market.
Six Sharia principles governing financial transactions
1. The default ruling in all transactions is permissibility.
2. In contracts, the intention and meaning take precedence over literal wording.
3. It is forbidden to acquire people’s wealth unjustly.
4. No harm shall be inflicted nor reciprocated.
5. Transactions should prioritize ease and facilitation, not severity or hardship.
6. Customs and traditions are to be respected, provided they do not contradict Islamic law.
By Marwa Al-Bahrawi Al-Seyassah/Arab Times Staff
