Where are real estate prices in Egypt headed?

Real estate prices in Egypt are witnessing unprecedented increases. Due to the economic pressures that the country has been exposed to recently.

This comes at a time when many investors, institutions and individuals, are resorting to buying real estate - as a store of value - in order to preserve their money, after the pound was exposed to a significant decline in its value, and with the possibility of a new devaluation expected in the coming period.

Price increase

According to estimates from local reports, prices rose during the current year 2023 by up to 75 percent, in light of the accumulation of economic burdens resulting from geopolitical factors and their repercussions, especially the war in Ukraine and its effects and the extensive pressures it imposed on various economies.

These increases are expected to continue during the next year 2024, especially in light of the uncertainty facing the global economy, and with the escalation of geopolitical risks and their repercussions on the country.

40% increase in prices

While those working in the sector agree that prices will rise over the next year, their estimates differ regarding the percentage by which they may rise.

According to what was reported by media reports about the Chairman of the Board of Directors and Executive Group of Palm Hills Development Company, Yassin Mansour, he expects real estate prices to rise by up to 40 percent during the next year 2024.

While reports from Al-Tameer Real Estate Finance Company “Al-Oula” quoted estimates of possible price increases of up to 25 percent.

Rising prices

The Executive Director of the Real Estate Development Chamber at the Federation of Industries in Cairo, Counselor Osama Saad El-Din, said that the real estate product, whether administrative, residential or commercial, is a set of inputs; Such as iron, cement, bricks, etc. and related building materials.

The prices of these inputs have gradually increased, leading to an increase in the cost of real estate.

There are some other reasons associated with importing some of these materials from abroad that ultimately affect the prices of the real estate product.

Real estate market in Egypt

It is noteworthy that, according to data provided by the Information and Decision Support Center of the Council of Ministers, in a recent report, it is:

The size of the residential real estate market in Egypt is expected to grow from $18.04 billion during the current year 2023 to $30.34 billion by 2028 (a compound annual growth rate of 10.96 percent).

This expected growth is supported by the increasing demand for residential units in major cities in Egypt, as well as government initiatives and upcoming projects that are also the main drivers of the market.

According to data from the Ministry of Planning and Economic Development, the contribution of the building and construction sector to the annual growth rate of the total value added at the cost of production factors at constant prices amounted to 6.99 percent during the fiscal year 2021/2022, and the percentage in the real estate activities sector reached about 3.24 percent during the same year. According to the aforementioned report.