The Egyptian Property Boom
New Update 26/06/08
EGYPT. Egypt's real estate market activity is increasing at the rate of 40%, according to Prime Minister, who expects more growth in the market in the coming months. Property is increasingly open to foreign investors and tourists>>Read Report
Property market value in the Egypt has gained 23% in the first 6 month in 2008. The Main factors behind this sustained Capital appreciation are:
1-Easy access to Mortgage and Property finance : According to The Egyptian Minister of Investment, The value mortgages market increased from LE 16 million in June 2005 to LE 2.2 billion in March 2008.>>ReadReport
2- Increase in market demands for houses and holiday homes.
3- Increase construction costs
Since the start of 2004, the Egyptian property market is experiencing constant steep rise in property market both in residential and touristic zones.
According to analysts this seemed to be fueled by the:
1. Increase influx of foreign investment money to Egyptian market especially from the gulf countries, secondary to accumulated wealth caused by increase oil prices.
2. Massive shake up of the Egyptian investment legislations by aggressive economic reforms.
As a result, Direct Foreign Investment in Egypt, which in layman’s term means foreign investors money brought to Egypt had surged from 4 billion US$ in 2004 to 7 billion US$ in 2006. Most of this money were invested in high tech and telecommunication and industrial projects which in turn had increased the purchasing power of the average Egyptian buyers adding to this increased interest among Arabs and westerns in the Egyptian tourist and residential properties due to the very modern and up market resorts appeared in the market also the government decision to give free hold property to foreign purchasers. The final result was sudden increase in property demand in the Egyptian local market with a much less limited supply of property
It is constantly reported in many independent economic reports that last year average gain in the Egyptian property market was between 20-40% depending on the location. After the government passed the mortgage law in 2004, there was a strong and solid feeling among all the investors in Egypt that it is now the time to buy before the price surge that will be expected when the financial institutions starts to offer property finance in the local market for the first time in the Egyptian history, again that heated the market even further . Yet another 2 reformed legislations were passed recently… one to abolish stamp duty and rectify the property registration fee to be capped at max of £e2000, (€260) and simplifying the registration process to 120days, the second one to abolish the death succession tax completely down to Zero. Minding you that in the new Egyptian Tax Law, there was no more CGT in Egypt. All of these factors seem to be constantly pushing the property market up in a country of 79 million people most of them are still thriving to buy their first home whenever the mortgage system start to work.
Report Published 9 October 2007
Among several independent previous reports we choose;
Third price peak in 2007: >>Read Report Ain Sokhna Boom : >>Read Report Nick Clark Report:Property prices in Egypt have surged. Price rose by 50%. Rental yields reaching 11% . Article first published 6 March 2007. >>Read Report |
