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Lower Egyptian Pound Value Seen to Push Real Estate Prices Up

Posted by Jereco O. Paloma on Feb 10, 2016 12:20 PM EST
Modern Cairo Reveals Its Ancient Islamic History more big
CAIRO, EGYPT - FEBRUARY 20: A view of the city is dominated by the Mamluk 14th century madrasa and mausoleum of Sultan Hassan (center left) and the early 20th century Ottoman-era neo-Mamluk Rifa'i mosque (center right), as seen from the Citadel, the seat of Islamic rule over the country for about 700 years since it was built by Salah al-Din in the late 12th century, on February 20, 2009 in Cairo, Egypt. Despite being known primarily for its Pharaonic monuments, some almost 5,000 years old, the country has a rich Islamic heritage. The various Muslim dynasties, which ruled the country since its capture from the Byzantines by the Muslim Arabs in 639 AD until the demise of the Ottoman Turks at the end of the First World War, have left the country with hundreds of splendid buildings erected by the ruling elite of more than 1,200 years. (Photo : David Silverman/Getty Images)

The continued devaluation of Egyptian Pound was seen to cause skyrocketing real estate prices in Egypt, a report showed.

Industry data released by real estate consultancy firm Jones Lang LaSalle (JLL), as reported by the Daily News Egypt, had revealed that despite the devaluation of the pound, the country's property market remained relatively stable, especially in the third quarter of 2015.

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Across all sectors, retail and hospitality showed the most noticeable slowdown. The report, however, noted that the recently completed expansion project of the Suez Canal was seen to boost prospects and opportunities in the upcoming years.

Ayman Sami, chief of JLL Egypt, told the Daily News Egypt in an interview that Egypt faces a lot of headwinds in the coming years, as well as opportunities for growth.

"We are quite optimistic with regards to the real estate sector in general in 2016. We cannot say that all activities will perform the same way. We are currently monitoring the residential, offices, retail, and hotels markets. Hotels have been the hardest hit asset class due to the reduced level of tourism, affecting both room rates and occupancy," Sami was quoted as saying by the Daily News Egypt.

Sami, however, said they are expecting that the current market condition, especially in the hospitality sectors, will improve as the country's property markers slowly stabilize. The report also noted that to compensate for the loss from other underperforming markets, Egypt's housing market is taking the lead, which acts as a buffer against dwindling pound value.

Meanwhile, in a report published by Albawaba, the construction sector in the country is now complaining about the red tape that's becoming a major hindrance in many construction firms. According to the Egyptian Businessmen's Association and Egyptian Federation for Construction and Building Contractors (EFCBC), the bureaucracy in the government is becoming more of a burden.

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