Secret Egypt: Where & How to Invest

Secret Egypt: Where & How to Invest

Egypt is unique. Across this vast country exists over 5,000 years of history intertwined with modern living. With its year-round sunshine, beautiful seas, historical monuments and vibrant towns and cities, there is something appealing to everyone, no matter your lifestyle preference.

When it comes to property, foreigners can buy up to two residential properties in Egypt and ownership is restricted to certain touristic zones. Foreigners who buy in these touristic zones are granted the same rights as Egyptians apart from in Sharm El Sheikh (which we will explore in further detail below).

The properties on offer in Egypt vary enormously from small €20,000 apartments in Hurghada to multi million Euro properties in El Gouna, like luxury homes in the Caribbean but without the long-haul travel. Your money goes a long way in Egypt and the low cost of living is appealing particularly with the current very attractive exchange rate.

Location, Location, Location – Where to Invest

1.The Red Sea

Property in the Red Sea region is almost exclusively located along the coast. This is unsurprising when you consider that its warm crystal clear waters and pretty much permanently cloud free, sunny skies are year-round drawing tourists to sample the excellent water sports and party lifestyle that the coast has to offer. Hurghada is the hub of the Red Sea region and offers an international airport which has direct flights to various locations throughout Europe. Within the Red Sea itself, there are two destinations where foreigners can safely invest with little risk. 

El Gouna

Located approximately 25 minutes north of Hurghada airport, El Gouna is a private coastal town that many compare to Venice owing to its network of lagoons connecting the different neighbourhoods of the town. Part of El Gouna’s charm lies in the fact that it is a real melting pot of nationalities. From Cairo’s wealthy elite to Austrian aristocrats, El Gouna offers an escape for everyone. It is one of the few resorts built for residential tourism, giving it a permanent group of people who live their all year round which is then supplemented by the seasonal property owners and the tourists who stay in one of the towns 14 hotels or who rent one of the private villas or apartments in the town.

El Gouna offers extensive infrastructure and the developer is not only responsible for developing the town, but also operates it. As the town has a 25-year history and a track record, investors can feel confident that the developer will be around for years to come to ensure that the town continues to flourish and grow. Very few resort towns enjoy the sort of facilities that are offered by El Gouna. The town has its own marinas, hospital, school, universities as well as over 100 restaurants, shops, kids’ activities, cafes and so much more. It provides a genuine community.

There are quite a range of property options available in El Gouna depending on whether you are looking for somewhere to retire, a fly-to-let, somewhere to live and work and so on. There are villas, twin villas, townhouses and apartments scattered throughout the town with prices starting from circa €220,000.

Somabay

Somabay is a small, well established coastal resort which sits approximately 35 minutes south of Hurghada. Although it is small, it benefits from excellent infrastructure including the 18-hole Gary Player Cascades Golf Course, marina, Thalasso spa and five operational hotels. It is on a beautiful peninsula that juts out into the ocean making it feel like its own private island.

As the resort offers fewer facilities and is less ‘trendy’ than its counterpart El Gouna, prices in Somabay are approximately 50% lower than in El Gouna giving plenty of room for capital growth as the resort expands. There are apartments, villas and townhouses available in Somabay with prices starting from circa €85,000. REGISTER NOW for real estate in Somabay via our Member Only section.

There are also Sahl Hasheesh and Hurghada as potential property investment locations in the Red Sea area. Sahl Hasheesh is in a beautiful location about 20 minutes south of Hurghada and offers a range of property developments within a large scale resort complex. Investors should note that the master developer has sold off its land plots to sub developers and over the course of the last 10 years or so, there have been some projects launched which haven’t come to fruition. This is the reason that it isn’t in our top selection of Red Sea property options as the security of the investment is far lower.

We cannot forget about Hurghada itself. There are a myriad of off-plan and built properties available in Hurghada at a generally low cost. The environment of Hurghada isn’t as polished as in El Gouna or Somabay, so you’re really buying into a local lifestyle. You should beware of off-plan projects in Hurghada and make usual due diligence to ascertain the safety of any investment before putting your money down.

2. Sharm El Sheikh

Sharm El Sheikh is a stunning resort city which is focused primarily around resort living. It is located on Egypt’s Sinai peninsula and has its own international airport with excellent connections throughout Europe. It is home to a huge number of resort hotels and increasingly more property complexes. The majority of the properties are in independent complexes and can be lacking in facilities as a result meaning that if buying in Sharm El Sheikh, it is best to be near other pre-existing facilities. Naama Bay area has the most extensive infrastructure and facilities at present outside of the hotels.

Ownership of property in Sharm El Sheikh is significantly problematic. Because of the political geography of the Sinai Peninsula upon which Sharm El Sheikh is situated, foreign ownership of property in Sharm El Sheikh can only be on a leasehold basis for 99 years. It is also not possible for a foreigner to register any property in Sharm El Sheikh. Foreigners can not own any property outside of Sharm El Sheikh on the Sinai full stop owing to the political sensitivity of the peninsula.

Prices in Sharm El Sheikh have a similar range to the Red Sea area with apartments available from circa €20,000 through to around €800,000. MEPM can source property in Sharm El Sheikh through our network of contacts, but would always recommend that if you’re looking for a seafront and water sport based location that you consider instead the Red Sea region which is less politically sensitive and provides for freehold ownership of property.

3. Other destinations in Egypt

If you want to consider buying in other locations in Egypt, you need to check the ownership basis (leasehold or freehold), social demographic (there are some parts of Egypt that are not appropriate for foreigners) and you must check that foreign ownership is allowed in the area. Foreign ownership is only allowed in areas designated as touristic zones by the government. These areas include Hurghada, the Red Sea (already contemplated above) as well as Sidi Abd Rahmen and Raas El Hakma which are two development towns on the Mediterranean North Coast to the west of Alexandria.

The North Coast is popular amongst the wealthy Egyptians, most of whom have a summer residence in one of the many luxury complexes along the seafront which is often considered Egypt’s most beautiful beachfront. The North Coast is very busy during the summer season, but generally during the winter season it is almost deserted as Egyptian’s tend to holiday on the Red Sea or head to Europe at this time of year. The people in these resorts are primarily Egyptian and Middle Eastern, so you will need to take this into account if you are a foreigner unfamiliar with Egyptian culture, but as the destination developes it is intended that it will attract more foreigners. In Sidi Abd Rahmen you will find Marassi Resort a development by Emaar which is currently the most suitable resort for foreign investors.

 

Be Safe - How to Invest

1. Check the Developer Track Record

When you are buying an off plan development you must be particularly careful to check that the developer has a track record and has delivered properties already. You will also need to check that they have title to the land and permission to build. You might get lucky with a new developer who you’ve not checked out, you might not. Do you really want to take that risk?

2. Check Built Property Ownership

The property registration system in Egypt is relatively new, so when buying an existing, rather than an old property, the risk is that you cannot trace its ownership and that having brought the property some cousin fifty times removed comes out of the woodwork and claims their stake in it or alternatively you could find that there is debt against the property when you attempt to register. It is estimated that approximately 90% of properties in Egypt remain unregistered owing to the high registration fee which has recently been reduced to a maximum of LE 2,000 (circa €110) to encourage registration. If you decide to buy a built pre-owned property then getting yourself a good lawyer is essential as they will need to check and validate ownership of the property. On the other hand, if the property is already registered or the contract has been properly certified and the names match to that of the seller, then you are usually safe to proceed.

3. Decide your Registration Mechanism

Decide how long you want the property for and do you want to rent it. There are two methods to safeguard your property ownership in Egypt. One is to register the property and the other is to secure a certificate of validity which in effect legalises your purchase contract. Owners of registered properties must own them for 5 years, you are not allowed to sell or rent the property before this time. This is the most secure method of ownership, but the conditions often make it unviable for foreigners. So, if you are looking for a flip scenario or a fly-to-let or even if you want to buy more than two properties, then the certificate of validity will be your best option, albeit less secure.

4. Get a Good Agent

Get a professional estate agent who knows the market well. MEPM has had links with Egypt for more than 10 years and is very familiar with the best places to invest, knows the credible developers and has access to some of the very best resale properties on the market. A good agent can help you through the process of buying a home in Egypt.

5. Don’t Expect Mortgage Finance

Interest rates in Egypt are far from those in Europe. As we put together this article they sit at 14.75%. While new laws now make mortgage finance available at least to locals, the high interest doesn’t make for much of a lending market as the debt would be too expensive and thus unappealing to foreigners. If you want to invest in Egypt, you need to either have the cash reserves to make the purchase or you need to source finance outside of Egypt (again this may be expensive if leveraging against the property in Egypt itself). Make sure you know where your money is coming from before you commit.

6. Ensure you have Bi-Lingual Contracts

In order to be legally binding, your purchase contract should be in Arabic or in dual language (any other language and Arabic). Make sure that you have the Arabic content validated by your lawyer to know that it is fundamentally the same as the other language, because it is the Arabic ‘version’ that will be used in case of any legal action.

7. Validate Land Ownership

Check and validate the ownership of the land by the seller and also make sure that the contract specifies that the land will be owned by the buyer. In Egypt, there is no obligation for the seller to also sell you the ownership of the land. They could then become your landlord and you find you have to pay rent or similar for use of the land. Even if it is the case that the land isn’t included in the sale, detailed terms should be set out at the time of purchase relating to rights of use and setting out what happens should they ever sell the land.

8. Examine the Payment Plans

Most developers will offer payment plans for off-plan property through the construction period. Make sure that the final payment is linked to delivery of the property and is only payable after inspection. If viable, especially with less established developers, get a payment plan where payments are linked to stages of construction.


The MEPM team can help you find a property in Egypt to suit your needs and can be with you throughout the purchase to make the process hassle free. We have a range of properties available in Egypt’s best destinations for foreigners. Check out some of our favourite Egyptian properties below or get in touch now for a private consultation.

 

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2 Bedroom Mangroovy Apartment in Beach Front Development

Mangroovy, El Gouna, Egypt

2Bedroom(s)
2Bathroom(s)
16Picture(s)
105.85
Visits:39

For sale in the prime beach front development of Mangroovy Residences a two bedroom apartment on the first floor. The apartment offers 105.85 m2 of living space plus loggias & balcony of 10.9m2

A masterpiece of nature-conscious architecture and luxury, Mangroovy is a lavish seafrontcommunity, blessed with El Gouna’s most desirable 360 meters of sandy beaches.

$224,740

3 Bedroom Mangroovy Apartment in Beach Front Development

Mangroovy, El Gouna, Egypt

3Bedroom(s)
3Bathroom(s)
16Picture(s)
171
Visits:35

For sale in the prime beach front development of Mangroovy Residences a three bedroom apartment on the top floor. The apartment offers 177 m2 of living space plus loggias & balcony of 33.53m2 as well as roof terraces of 88.5m2

A masterpiece of nature-conscious architecture and luxury, Mangroovy is a lavish seafrontcommunity, blessed with El Gouna’s most desirable 360 meters of sandy beaches.

$405,946

1 Bedroom Mangroovy Apartment in Beach Front Development

Mangroovy, El Gouna, Egypt

1Bedroom(s)
1Bathroom(s)
17Picture(s)
62.55
Visits:38

For sale in the prime beach front development of Mangroovy Residences a one bedroom apartment on the first floor.

A masterpiece of nature-conscious architecture and luxury, Mangroovy is a lavish seafrontcommunity, blessed with El Gouna’s most desirable 360 meters of sandy beaches.

$126,302

1 Bedroom Tawila Apartment with Private Garden

Tawila, El Gouna, Egypt

1Bedroom(s)
1Bathroom(s)
13Picture(s)
80.86
Visits:34

For sale a 1 bedroom apartment located in El Gouna’s new development Tawila. This unit offers 80.86 Sqm of living space and a private garden. Tawila Apartments come in two interior design choices. Pick from either Chic Hues or Earthy Flair.

Nestled amidst the azure blue waters is Tawila, a picture perfect masterpiece waiting anxiously to be captured.

£67,000

2 Bedroom Tawila Apartment on 3 Levels

Tawila, El Gouna, Egypt

2Bedroom(s)
2Bathroom(s)
13Picture(s)
100.72
Visits:37

For sale a 2 bedroom apartment located in El Gouna’s new development Tawila. This unit offers 100.72 Sqm of living space and a roof area of 26.50 Sqm. The apartment is designed over 3 levels. Tawila Apartments come in two interior design choices. Pick from either Chic Hues or Earthy Flair.

£125,000

2 Bedroom Tawila Apartment with Large Roof Terrace

Tawila, El Gouna, Egypt

2Bedroom(s)
2Bathroom(s)
13Picture(s)
93.07
Visits:40

For sale a 2 bedroom apartment located in El Gouna’s new development Tawila. This unit offers 93.07 Sqm of living space and a large roof terrace of 69.50 Sqm. Tawila Apartments come in two interior design choices. Pick from either Chic Hues or Earthy Flair.

Nestled amidst the azure blue waters is Tawila, a picture perfect masterpiece waiting anxiously to be captured.

£125,000

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