If you are thinking of investing in real estate in Egypt, you may be wondering what the future holds. What is the real estate market in Egypt like? Is it growing or shrinking? What are the major trends affecting real estate in Egypt? Here is some information that may be of interest to you. You can read about the economic reform in Egypt and how the military is expanding its commercial reach in the real estate market. In addition, this article will give you some insight into Covid-19 and the Military’s commercial reach in Egypt’s real estate market.
Covid-19 impact on Egypt’s real estate market
Egyptian property developers are predicting a strong return to the local real estate market in 2022, coincident with the country’s economic recovery from COVID-19. The American Chamber of Commerce in Egypt organized the Real Estate Market Transformation conference, in which chaired by Magued Sherif, managing director of SODIC, said that Egypt’s real estate market is likely to experience a boom in the next two years. Several real estate companies are rethinking their floor plans and projects, in anticipation of the new economic climate.
While there are no specific figures to back this up, Egypt’s real estate sector has experienced significant growth since the beginning of the year, with an increase of eight percent in hotel occupancies and 150% in flight traffic by expatriates. According to the report, the largest segment of active buyers is first-time homebuyers, while some are newlyweds or people entering the real estate market. The report also reveals the breakdown of purchase objectives by socioeconomic status. While most buyers in socioeconomic status A and B are upgrading their current home, those in socioeconomic status C are buying their first home.
According to the report, the residential market in Cairo finished almost 4,000 units during the first three months of 2021. This is a positive sign, especially as new gated communities have become more mature and livable. The overall residential stock in Cairo was approximately fifteen thousand units in January-March 2021, with another five thousand completed during the final nine months of 2019.
Expats’ preference for direct methods over realtors
In recent years, the government has begun implementing several reforms, including a new companies law, investment law, and bankruptcy law. Additionally, the government has announced plans to simplify business laws and procedures, such as the 2020 Customs Law. One of these reforms will include a single-window system and electronic payments for companies authorized to do business in Egypt. Ultimately, these reforms will increase the business climate in Egypt.
While the cost of property in Egypt has risen considerably in recent years, the process remains relatively straightforward. Property registration fees in Egypt are capped at EGP 2000 (USD 110), regardless of the property value. In addition, foreigners are only allowed to own two residences in the country. The real estate industry in Egypt has many specialized agents, but you should avoid those that advertise a large number of employees.
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While most expatriates move to Egypt for their job, some companies or schools offer accommodation allowance as part of the agreed salary. However, if your employer is not offering housing assistance, you may want to consider hiring a real estate agent to help you navigate the property market. An agent can help you overcome the language barrier and navigate the local property market. If you’re moving to Egypt from another country, it’s worth considering hiring a real estate agent.
Despite recent developments, the housing crisis in Egypt is far from over. The unregulated market has led to rapid price inflation, outpacing income increases. This situation has been promoted by a number of forces, including the government, Egypt’s largest landowner, which has an interest in maximising profits from land sales. Moreover, the country’s government has made it harder for locals to buy property than it would have been otherwise.
The new government regulations introduced in 2021 are likely to further increase the pace of project completion. This measure may counteract the effect of increased inflation and the impact of a new rule banning developers from selling units until 30% of a project has been completed. Egypt’s real estate market is expected to grow by about 29,000 units in 2022, most of which will be in eastern Cairo. Considering that the population of Greater Cairo is set to double within the next several decades, this trend will only accelerate.
The new constitution will also allow for a longer presidential term. While the recent elections were not free and fair, there are already plans in the works to extend the term of the current president to 2024. In the meantime, Egypt will be on the lookout for properties that can benefit from the new government. If the government continues to promote reform, real estate prices will continue to climb, especially in cities and larger suburbs.
Military’s commercial reach in Egypt’s real estate market
Egypt’s military economy has expanded far beyond basic military needs, touching all sectors of the economy. While precise figures are hard to come by, Middle East Eye interviewed several experts in this area who claim that the military’s commercial activities touch nearly every economic sector. These concerns were unfounded prior to 2013, but have begun to materialize now. In this article, we’ll examine how Egypt’s military economy has impacted the real estate market.
The military’s objectives in working with the private sector are at odds with their primary objective of protecting the country. While ostensibly seeking to promote small and medium businesses, the military is seeking investment, expertise, and capital that it could not acquire without external assistance. In many cases, this strategy has hampered the development of Egyptian real estate. The military’s commercial reach is inextricably linked to the military’s commercial objectives.
The military’s commercial reach in Egypt’s realty market is further complicated by its immunity from third-party challenges. Under the military’s legal system, state land can be leased from the state rather than purchased. However, this does not mean that the military can purchase these properties, and they have the right of usufruct over such land. Despite these benefits, it is crucial to note that a military-run company cannot engage in third-party challenges. This could cause long delays in a transaction, and could potentially drive foreign investors away.
Suez Canal development plan
The President of Egypt has introduced a government regulation preventing developers from selling apartment units until at least 30 percent of the project is completed. This action is likely to boost project completion rates. Egypt’s development plans include building 29,000 new apartments by 2022. A majority of these units will be located in the eastern part of Cairo, as the city’s population is expected to treble over the next few decades. However, construction delays, increased labor costs, and higher expenses may hinder the pace of development. In worst case scenarios, some projects may be cancelled entirely.
The Suez Canal Development Plan is a key project of the Sisi government. The New Suez Canal project adds a 35-kilometre shipping lane and deepens an existing 37-kilometre section of the Suez Canal. This plan is expected to reduce the pressure on the city’s streets and help the country attract foreign investors. While the new canal is not yet finished, the development plan also aims to improve the quality of life in the cities.
While the first two lanes of the Suez Canal have been reconstructed, the second lane of the canal remains under construction. At a cost of more than $8 billion, the second lane did little to increase revenues. Foreign conglomerates have been unwilling to invest in the new administrative capital. Meanwhile, the government’s reliance on mega-projects is helping the elite to accumulate wealth. Unfortunately, it has been unable to provide adequate protections for the poor. For more interesting blogs, Please Visit Heidingsfelder
Mortgage financing model
Nawy, the leading Egyptian proptech company, recently launched a mortgage financing service for pre-owned properties. The startup hopes to help bridge the gap between traditional lenders and those looking for a mortgage for their pre-owned properties. As a result, the Egyptian real estate market is expected to grow by 10% in 2022, and more than half of respondents expect prices to increase in the same period.
The growth of e-commerce businesses in Egypt will continue to increase the demand for warehouse space. Moreover, the government is considering public-private partnerships to stimulate land prices. These partnerships are important for the government as they allow them to participate in the profits of joint projects. For example, the government is now the largest landowner in the country and is therefore able to get equity shares in the profit from joint ventures with private companies.
The demand for rental housing has been growing at a rapid pace since the pandemic, and this trend will continue into the next decade. There isn’t enough supply to meet demand and, as a result, prices will increase. The supply of rental housing isn’t growing fast enough to keep pace with the demand, and rising construction costs are forcing builders to raise rents in order to remain competitive. The lack of rental housing is forcing rent prices to outpace house price growth.