Egyptian housing market went on the mend

22.09.2010 16:18
Real Estate Market Analysis | Egyptian housing market went on the mend According to experts, the restoration of residential real estate market of the country after two years of decline caused by economic growth and increasing domestic and foreign demand for housing.

Favourable macro-economic indicators are among the key factors of the active rehabilitation of the housing industry of Egypt, according to analysts Global Property Guide. For the 2009/2010 financial year the GDP grew by 5.3%, and the end of 2010 is expected to increase by 6%. In the II quarter of the construction industry showed the largest growth among other sectors of the economy - 13.2% annualized. This happened, including through large-scale projects implemented in Egypt.

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A worrisome sign is the high level of inflation, which in June amounted to 10,7%. However, it is expected that in the next 12 months it drops to 10%, and by mid-2012 - up 9%.

The system of mortgage lending is still underdeveloped, which creates certain difficulties for home buyers. On the other hand, it helped Egypt to avoid serious negative consequences of global mortgage crisis.

In the overall investment climate of Egypt is attractive to foreigners - not least thanks to the "friendly" state fiscal policy on real estate. Currently, the tax on its own does not exist. The government intends to introduce it to the objects value from 500 thousand pounds ($ 91.5 thousand) from 1 January this year, but not to "frighten" customers, decided to postpone this measure. In any case, according to professionals, this tax because of its insignificance, will not have a significant impact on the housing market. For instance, for facility worth 500 thousand pounds he will be around 30 pounds ($ 5,5).

"Locomotive" of domestic demand in the Egyptian housing is a stable population growth. In addition, interest on the part of the Egyptians and from abroad, "fueled by" public auction for sale of real estate.

Increased demand brings with it the price rise. Last year, the cost of housing falls - so, in a segment of the secondary private homes decline amounted to 37% compared with 2008. In I quarter of 2010, prices have risen by 5%.

In the I half of the average cost of apartments in Cairo, was $ 1,320 per square. m. In the area of Maadi prices fluctuated between $ 480-1240 per sq. m, in Zamalek - $ 1320-1760 per sq. m. In the new areas Al-Rhab, Medinat October and Medinat Sheikh Zayed square meter costs about $ 880.

Analysts predict that the trend appreciation of the Egyptian housing will continue, and for the year it will rise in price by 10%.
Content tags: Overseas property Housing
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