Egypt’s Real Estate Sector Rallies & Rides the Tide of Uncertainty to Reignite its Glory
Despite the ongoing effects of the COVID-19 crisis, Egypt’s property developers enjoyed a bumper Q3 last year, with sales turning positive on a YoY basis, reflecting optimism for a quicker and more robust recovery over 2021.
While surveying about 17 developers on the sidelines of Cityscape Egypt’s return last November to identify how they cope with the new normal, Invest-Gate’s R&A team explores the post-Coronavirus supply and demand pillars to take a comprehensive look at the prospects for real estate in the year ahead, thereby putting together a summarized wrap up on the pandemic bang from all aspects.
That comes on the back of the contact bans and curfews imposed by Egypt to curb the virus spread, not to mention the government-dictated precautionary measures. All of this had a statistically significant negative effect on real estate sector performance for hampering the customary process of brokering and marketing products.
Although the sense of uncertainty is still unsettling, thanks to the resurgence of a second COVID-19 wave, the Egyptian real estate market has been rallying to navigate the outbreak, therefore rising again and riding the tide of tension as of Q3 2020 to remain on pace for sustainable urban development in line with Egypt Vision 2030.
In 2020 only, at least 103,000 housing units have been built across various new cities, with combined investments of EGP 23.46 bn, says Minister of Housing, Utilities, and Urban Communities Assem El Gazzar.
From developing and upgrading Egypt’s infrastructure to gearing for the inauguration of more than 20 new cities across the country, the government spares no effort to create conditions conducive to urban growth and to lay the foundations for a more vigorous economy moving forward.
Reconciliation in construction violations, digitization of all things real estate, development of a well-crafted mortgage finance system, and more initiatives are taken for both public and private sectors to break through.
With the government’s blessings, there is a maturing optimism from almost 88% of surveyed respondents about developers’ ability to continue work on their property projects across Egypt, thereby positively contributing to extra real estate supply in the months to come.
Better yet, 65% of respondents plan to boost their supply in 2021 by launching new projects and sticking to their schedules to deliver more units. However, some others are skeptical about market conditions and how things will stand in the near term. About 35% of responding companies would instead go in a wait-and-see mode to optimize in the face of uncertainty.
Most of all, market players are optimistic for a much stronger real estate sector that will bounce back even more potent in 2021.
Hopes are high that Egypt’s robust property market can help the doing business remain vibrant in the near term, even against more enormous economic headwinds showing up on the run.