Real Estate in Egypt

With the Egyptian government actively promoting the buying of property in Egypt, even changing some of its residential tourism laws to make it easier for foreigners to buy property there, it is unlikely that Egypt will remain a relatively unknown destination for too much longer.

More overseas purchasers are already buying property in Egypt. The Egyptian real estate sector has recently experienced a substantial growth, partially stimulated by relatively strong demands from expatriates and foreign nationals to purchase properties in Egypt. Traditionally, the overseas property market in Egypt has been concentrated in and around El Gouna, a resort about the same size as London located on the Red Sea coast some 600 kilometres south of Cairo, the capital.

The government have actually been actively promoting the property market to overseas investors, highlighting their thoughts and hopes for the future. Unfortunately the fee structure and property register in Egypt is massively out of date, with many suggesting that only 10% of the country’s properties are actually registered.

The process and cost structure when buying a property in the country is very different compared to other countries. It is even more essential that local lawyers and property experts are employed to act on your behalf as registration issues can add massive delays and increased costs to any purchase. Until recently Property Registration fees where in the region of 12% of the property value (perhaps a reason why so few properties were registered) although this has now been reduced to 3%.

In general when buying property in Egypt from a new development, prices are set and there is little room for negotiation. Re-sale properties sometimes offer opportunity for negotiation.
In the resort areas of the Red Sea coasts, property investors are tapping into the increasing demand for short term rental accommodation, this market was non existent two years ago as in the past it was only possible to rent property on a long term basis. Some developers are begining to offer guaranteed rental income up to 8% of total property price. The introduction of good property management services are now making it possible for owners to rent their properties. And with low costs of living, property management and maintenance are low.