Published: 9th September 2013
When one considers the potential factors affecting the levels of property investment in a specific market, it is easy to see why many property investors are looking to Egypt for the high returns that they have become used to in recent times.
Pro-investment legislation, strong and consistent economic growth and an almost unparalleled market for tourism have meant that the level of demand for property in Egypt has increased steadily in recent times, and is only showing signs of increasing in the near future.
These sentiments are easily verified by a brief analysis of the Egyptian property market. Over the course of the past two years, a considerable number of major property developments have been announced by some of the worlds largest property developers. Developments such as Cairo Heights, New Cairo and Gamsha Bay represent significant investment in Egypt by developers such as Emaar and Damac as they look to capitalise on a market many see as offering strong potential returns in the coming years.
So why do people see the market for property in Egypt as such an opportunity? We decided to take a look at the major factors affecting the investment levels in Egypt today.
Strong Tourism Demand
With a rich heritage and culture which goes back thousands of years, Eygpt offers a wide variety of tourist attractions including the sights and smells of ancient Cairo, the pyramids in Luxur and the rich marine and coral life which can be found throughout the warm waters of the Red Sea. These attractions, coupled with the superb climate and close proximity to mainland Europe (which its increasing availability of low cost airlines) have resulted in increasing numbers of visitors to Egypt in recent years.
Property investors have looked to capitalise on these strong levels of tourism demand, with the property in Hurghada, Sharm El Sheikh and throughout the Red Sea resorts offering good opportunities for short term rental and second home markets.
Sustained Growth In The Egyptian Economy
Since Prime Minister Ahmed Nasir took office in 2004, Egypt has undertaken a series of pro-investment economic reforms, which have led to a period of sustained economic growth in the country. GDP in Egypt now stands at over 7%, and is expected to increase to nearly 7.5% during the course of 2008. These figures represent an exceptional economic result for the Egyptian administration, especially given the uncertain economic climate throughout the rest of the world.
With the current government in Egypt continuing with its progressive, pro-investment strategies, the levels of growth in the Egyptian economy seem only set to continue. Given the above factors, it is easy to see why so many investors are looking to Egypt to acheive the growth levels they have previously experienced in other, more traditional markets. The market for property in Egypt is undoubtedly still in its early years, and issues such as difficulties with land registration do still exist. However, these issues can be addressed through appropriate due diligence beng carried out.