At a time when real estate prices witnessed significant increases over the past year, and in light of the presence of more than one exchange rate for the US dollar (before the liberalization of the currency), the current period constitutes a bottleneck for the sector, as a transitional stage in which everyone experiences the repercussions of these developments on the general economic situation and on prices. , especially the prices of building materials.
Hence, it is widely expected that real estate prices in Egypt will “stabilize” during the coming period (in the short term), after the floatation of the pound, according to the British real estate services company Savills.
At the same time, the company expects an increase in demand by investors and Egyptians abroad to buy real estate in light of the decline in the value of the pound against the US dollar, especially since many investors had previously refrained from investing in the country in light of the state of uncertainty regarding the trends of the local currency. Therefore, floating the currency means the return of those investment flows to the real estate sector and the recovery of demand thereafter.
Al-Bustani added that the real estate sector is currently beginning to return to a state of equilibrium and balance, attributing the reason for this to:
The Ras al-Hekma deal reflected great confidence in the Egyptian economy, especially the real estate sector.
Steps taken by the state in the economic reform process.
Al-Bustani expected real estate prices to stabilize during the current year 2024 due to:
Stability or decline in the prices of building materials, especially iron, which is the main element in the real estate process (..).
The availability of basic and necessary raw materials, which were not sufficiently available in the past period (given the import crisis), and therefore real estate prices will stabilize if not decline.
The stability of the dollar price will play an important role in further decline in the prices of these raw materials.
Continuous dollar flows into the Egyptian market.
Al-Bustani expected that the precautionary policy by developers would continue until the effects of liberalizing the exchange rate and the Ras al-Hikma deal became clearer, adding: “Within two months, the vision will become clearer.”
The current period is viewed as a “transitional phase” after which the trends in real estate prices in Egypt will be more clearly determined, especially with the clearer vision regarding the performance of the Egyptian economy and its ability to withstand, supported by the dollar flows entering the Egyptian market and their effects on prices.
In addition to the “Ras El Hekma” deal, which revived the Egyptian economy and constituted a certificate of confidence in it, the International Monetary Fund announced, in a statement, that Egypt had obtained the approval of the Fund’s Executive Board to increase the extended financial support program to eight billion dollars, which allows the withdrawal of about 820 million. dollars instantly.
Last March 18, Egypt signed with the European Union a new financing package worth 7.4 billion euros ($8.06 billion) over four years, which includes loans, investments, and cooperation in the files of immigration to Europe and combating terrorism.
