Free Advice On Buying Investment Property In Egypt

Property in Egypt is a strong favourite with British overseas property buyers who have been buoyed by the potential for high capital appreciation. Whilst there has been undoubted capital growth, 42% in 2005 according to international surveyors,the Egyptian property market had its problems like any developing country should therefore be treated with caution.

Some of the property in Egypt has been of a sub-standard quality and property rental potential has been overblown. Overseas property buyers have invested predominantly in the areas of Hurghada,El Gouna, Safaga and Marsa Alam (sometimes spelled Mersa Allam or Marsa Allam). In the main, these areas have been overdeveloped where supply outstrips demand. The prices of many properties in Egypt are out-with the budget that can be afforded by local residents and are reliant on overseas property buyers who buy for investment or lifestyle reasons.

Overseas property buyers hoping to rent out their Egyptian property should ensure that their property has agreements with travel companies as Egypt is not the sort of country where tourists turn up and rent holiday apartments on impulse. Rental potential in many areas should be estimated at approximately 7%-9% net and not the 12% that is quoted by some. Genuine guaranteed rentals schemes are an attractive option to many investors as it gives peace of mind with regard to relying on a rental income, if necessary, and saves having to spend time marketing the property. Guaranteed rentals are not always genuine and are sometimes merely the result of the price increase in the property. Genuine guaranteed rentals can be given where the developer has agreements in place with tour operators and is therefore assured of occupancy levels.

Property in Egypt is still appealing for property investors. EU entry and the associated levels of investment as a result of membership will no doubt assist capital appreciation. Additionally, tourism levels are increasing making buying a diving destination property, golf property or beach property all the more appealing. The main consideration when buying property in Egypt is to focus on areas that are not over-developed. We can only recommend property in Egypt where our analysis has shown that there is good growth potential and importantly, the possibility to sell or rent at a later date. Such areas that have highest potential for selling and renting are as example in Marsa Alam which has a low number of completed apartments or flats for sale and it will be a few years for the construction of new apartment homes in Marsa Alam to catch up with the current demand. As more and more people are discovering this area, the available apartments do get sold and then they are occupied or let once completed.

Author: Ewan McGarrie
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