The Egyptian real estate market is witnessing noticeable changes recently as companies began to gradually increase unit prices, affected by the increase in building materials starting from last October.
Several real estate developers believe that the current period is the best ever to buy new properties before the upcoming price increase due to the existing inflationary wave in the world.
Tarek Shoukry, Head of Real Estate Development Chamber at the Federation of Egyptian Industries, and Undersecretary of the housing committee at the House of Representatives, expected price hikes in real estate market as a result of increase in building materials prices.
He added that concrete constitutes one-third of building process, which witnessed an increase of about 80%. Cement increased during the last month only from EGP 800 to EGP 1250, and one- third of the construction process is finishes that increased by approximately the same percentage, so the cost of construction works increased by about 25 to 30%, in addition to the cost of land and operation.
Shoukry projected price spikes ranging between 10-15% during the next two months, advising clients to quickly purchase before the inflationary wave had its consequences on the properties that will be developed in the coming period.
Yassen Mansour, Chairperson of Palm Hills Developments, said that the coming period will see an increase in real estate prices by average rates of up to 10%, as a result of the increase in the prices of building materials.
Mansour added that buying properties is the safest investment in facing inflation, projected a significant increase in demand for real estate purchases in the current and future period.
The Egyptian real estate market is very strong and healthy due to the large population increase, which creates real demand for real estate, he disclosed.
Nader Khozam, Go Khozam Developments Chairperson, said: “With the global inflationary wave, the need for speeding up construction works of sold units is increasing with expectations of a high construction cost.”
Khozam also expected price increases ranging between 10-15% in the real estate market during the coming period.
He pointed out that these price hikes push real estate companies to be flexible in spaces of offered units as well as payment plans to maintain boosting sales in real estate market.
Even with the expectations of price spikes, real estate market continues to sell due to its dependence on real demand, he elaborated, added: “Real estate is a fundamental commodity for any citizen. Moreover, initiatives provided by the state to support citizens’ purchasing power, the latest of which was the initiative of the Central Bank of Egypt for mortgage finance at an interest rate of 3%, contribute to revitalizing sales.”