The Real Estate Development Chamber, part of the Federation of Egyptian Industries, has called for the implementation of initiatives to bolster the real estate sector, including the introduction of mortgage plans with interest rates between 3% and 10%.
Tarek Shoukry, the Chairperson of the chamber, revealed that discussions are underway with the Central Bank of Egypt to evaluate the feasibility of such proposals. While he acknowledged the sector’s resilience, noting that real estate sales in Egypt saw significant growth last year, Shoukry pointed out that mortgage financing accounted for less than 3% of total sales.
The primary barrier to activating the mortgage system, according to Shoukry, is the recent surge in interest rates, which has hindered both real estate developers and customers from accessing affordable financing. He stressed the need to streamline the processes within financing institutions, including reducing documentation requirements to facilitate easier access to mortgage options. In addition, he advocated for setting annual targets for both private and social housing financing, with periodic evaluations to measure their impact.
Shoukry further forecasted a shift in real estate companies’ strategies, predicting an increased reliance on long-term payment plans of 12 to 15 years. This shift, he explained, would help mitigate the effects of rising property prices and inflation.
In response to ongoing market challenges, the chamber is also planning to approach the Ministry of Housing with a proposal to extend the deadline for real estate developers by six months. This follows a similar extension granted in August 2024, which allowed developers more time to complete and deliver projects.
Shoukry, who also serves as the deputy head of the housing committee in Egypt’s House of Representatives, emphasized that any extension should be tied to the start date of each project to ensure fairness and market stability. He noted that global economic conditions have placed additional pressures on developers, affecting their ability to meet deadlines.
In conclusion, Shoukry reiterated the importance of balancing project execution with sales targets. Despite challenges, the real estate sector had an exceptional year, with sales surpassing EGP 2.5 trillion in the 2024 fiscal year.
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