Should You Invest?
With a booming tourism industry, Egypt is welcoming a rapidly
growing number of international visitors who themselves are
creating a booming demand for property. More and more investors are
choosing to place their money in Egypt due to the very low costs of
property and the excellent appreciation rates that look set to
continue over the next few years, along with the consistent
predicted increase in demand.
- Excellent economic growth in previous years and also predicted
for the future.
- Pro-Western government that encourages foreign
investment.
- Thriving tourism industry.
- Good returns, some areas reaching figures of 15% and
above.
- Low taxes but transaction costs can reach 11%.
- Foreigners able to buy, own and sell Egyptian property.
- However, because the real estate market is young there is a
lack of transparency and a lack of reputable well-known
developers.
Rental Yields
Yields in Cairo vary from district to district, with the
desirable Maadi district offering the most attractive figures
ranging between 10% to 17%. Some developers in Egypt advise that
higher yields of 14% (for example) may be attainable but guarantee
a lower rate of around 5%. In a list produced by the Global
Property Guide, Egypt has the lowest price per square metre in the
Middle East, starting at only US$406 per square metre.
location
type of
property |
size
(m2) |
average
price
to buy
(US$) |
cost per
m2 to buy
(US$) |
average
price
to rent
(US$) |
cost per
m2 to rent
(US$) |
yield
(%) |
Cairo - Maadi -
Apartments |
|
|
|
|
|
|
| |
150 |
60,900 |
40 |
576 |
3.8 |
11.35% |
| |
200 |
82,400 |
412 |
858 |
4.3 |
12.50% |
| |
250 |
136,000 |
544 |
1,963 |
7.9 |
17.32% |
| |
300 |
288,300 |
961 |
2,439 |
8.1 |
10.15% |
| |
400 |
- |
- |
2,868 |
7.2 |
- |
| |
500 |
- |
- |
3,110 |
6.2 |
- |
Cairo - Mohandesseen-
Apartments |
|
|
|
|
|
|
| |
100 |
42,300 |
423 |
201 |
2.0 |
5.70% |
| |
150 |
70,800 |
472 |
416 |
2.8 |
7.04% |
| |
200 |
112,200 |
561 |
670 |
3.4 |
7.17% |
| |
250 |
149,750 |
599 |
1,000 |
4 |
8.01% |
| |
300 |
181,800 |
606 |
1,155 |
3.9 |
7.62% |
| |
350 |
233,800 |
668 |
1,239 |
3.5 |
6.36% |
| |
400+ |
352,400 |
881 |
2,420 |
6.1 |
8.24% |
Cairo - Zamalek -
Apartments |
|
|
|
|
|
|
| |
100 |
70,800 |
708 |
433 |
4.3 |
7.34% |
| |
150 |
109,800 |
732 |
617 |
4.1 |
6.74% |
| |
200 |
186,400 |
932 |
1,498 |
7.5 |
9.64% |
| |
250 |
294,750 |
1,179 |
1,680 |
6.7 |
6.84% |
| |
300 |
371,400 |
1,238 |
2,328 |
7.8 |
7.52% |
| |
350 |
402,500 |
1,150 |
3,066 |
8.8 |
9.14% |
| |
400+ |
570,000 |
1,425 |
2,740 |
6.9 |
5.77% |
Source:
Global Property Guide
Price History
Following a long period where only state building was permitted,
the government decided to allow private housing projects in the
1990s. This created a huge boom as developers started building to
profit from this new change, regardless of experience. As a result,
a surplus of building stock was created and developers became
bankrupt. Since then, certain factors have made Egypt a much more
attractive option, such as a lower currency, excellent rental
returns, Egypt posing a reduced risk compared to much of the Middle
East and a growing tourism market that is creating rocketing demand
for property.
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