Can you tell us about your company?
My company Home and More, has been operating in the Egyptian market for over two years; the company is specialized in renting, buying and selling units.
The districts my company operates are mainly 5th settlement, down town area, and districts that have high-end compounds.
What is your evaluation for the current state of the real estate sector in Egypt?
Well, I really think it is progressing now. The rents market was quite struggling up till recently in 2017, renting rate was higher and the demand was high in maadi, for instance and high-end compounds, due to the presence of foreign residents, yet as foreign residents and international companies decreased in Egypt, the renting rate went down as well.
I have also to mention that the high rate of the saving certificates of the National Ahly Bank, which gives an interest 20%, did affect the keenness of many people to invest in real estate; as in fact real estate in the Egyptian market has always been a very safe way for investment and for people who want to increase the value of their money with less risk taking.
2017 witnessed what we can call a state of stagnation within the real estate market due to the devaluation decision and the saving certificates, as I mentioned. For instance people in 2017 tended to buy units that started from EGP 700,000 up to EGP 4 or EGP 5 million, comparing to 2005, 2006 and 2007 when people were buying units up to EGP 8 million and EGP 10 million.
Certain high-end compounds also witnessed a state of stagnation in 2017 like Katameya heights and Katameya Dunes, and Lake view, super luxury homes, which prices start from EGP20 million, this is due to its high prices and people now are more reluctant to invest with a lot of cash.
However, end of 2017 witnessed a boost for the Egyptian economy; 2018 is excepted to witness another boost; also there has been a rumor circulating that the saving certificates of the National Ahly Bank might not be renewed; hence the real estate market is expected to flourish again by 2018. I need to pin point that a district like the 5th settlement and Katameya did witness a boom recently.
Does the inflation rate and the increasing prices of cement and steel affect the prices of real state units?
Yes for sure, this does make the price of the units higher; now the price of the meter in Katameya and 5th settlement high-end compounds, starts from EGP12,000 or EGP 13,000, paid with installments; however, if the down payment of the unit is high the price of the meter decrease; but I need to mention that there are better facilities for the installments system now being applied.
What other districts you think have good future potential?
Well, nowadays there is the “second home market”, in north coast and ain sokhna. These are two markets that people tend to buy in as well; not for investment purposes but for living purposes. There is also high demand for buying and selling in the north coast.
I definitely think that the 5th settlement is one of the districts that will witness a boost; and I do believe that the main reason is the new capital and actually this district has more empty spots for more compounds to be built, if compared to 6th of October city; I also believe that there are significant developers there, like Emmar, and other Emirati investors.
In your opinion, which district you think needs more marketing, within the real estate sector?
I would say the north coast; if the concept of regarding the north coast as only a place for summer vacation, got changed I think this will make a difference. In other words, if there is a plan to make more developmental projects in the north coast, to make it a place to live in all the year, this will give a very good boost to this area. We do have good projects overlooking the sea shore; however more projects are needed on the other side of road. Especially that the north coast is considered an expansion for Alexandria and Borg El Arab.
The red sea, especifically Gouna and Sahl Hasheesh, are they witnessing a high demand for buying and selling?
Well Gouna, definitely yes; it is the ideal destination for many people and youth who are looking for an excellent quality of life, a quality of life that guarantees a clear good weather and a high standard of living like Europe or Dubai. Prices in Gouna are higher than Cairo though.
Sahl Hasheesh, does not have high demand yet, however, I believe with a good marketing plan , it will be another perfect example of an ideal place that reflects an excellent lifestyle, and a good marketing plan is already taking place especially that Sahl Hasheesh hosts twice a year the international triathlon championship. I believe such big events are effective marketing tools.