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Egypt’s real estate market to attract $120 billion investment from the Middle East

A new report spotlights Egypt’s real estate market as an outstanding prospect for investment

Egypt’s real estate market to attract $120 billion investment from the Middle East
[Source photo: Anvita Gupta/Fast Company Middle East]

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There’s a renewed surge in global interest in the real estate market in Africa, particularly Egypt, driven by major investment commitments from the US, UK, South Korea, United Arab Emirates, Saudi Arabia, Turkey, and China.

According to Knight Frank MENA’s Africa Horizons 2023/24 Report, Egypt presents an enormous opportunity; with over 20 million residents and 185 million sqm of active real estate, the country offers huge potential. 

Middle East Sovereign Wealth Funds have shown significant interest in Egypt, with plans to invest up to $120 billion in the country in the coming years. 

Factors like the weakness of the Egyptian pound, the relatively affordable home values when compared to major cities in the Gulf, and the pleasant summer climate on the Mediterranean coast are adding to the country’s attractiveness.

In 2022, Egypt’s residential sector attracted $20 billion in real estate investments, of which $16 billion was allocated to residential properties in Cairo. The average price of residential properties in Cairo grew by 10% in the same year, highlighting the city’s strong demand for residential properties.

New Cairo, in particular, has seen a significant rise in apartment sale prices, with an increase of 24% year-on-year — around $450 per square meter (PSM), while villa prices have increased by 8.5% to $690 PSM. 

Similarly, Sheikh Zayed City’s apartment prices increased by 27.8% year-on-year, taking values to almost $430 PSM, while villa rates have increased by 2.1% to$625 PSM over the same period.

Egypt’s North Coast is also attracting attention as a second home market, with sustained demand projected. Summer home sales reached $2.1 billion in 2022 and are expected to increase by 30% in 2023. This demand is driven by the potential for capital appreciation, attractive rental yields in foreign currencies, and increasing interest from buyers in the Gulf Cooperation Council (GCC). 

“Egypt has always held a special place in the minds of GCC investors, and we are starting to see a demand renaissance of sorts, with GCC buyers increasingly looking at the Egyptian second homes market, particularly on the north coast of the country,” said Faisal Durrani, Head of Middle East Research at Knight Frank.

“This renewed demand comes hot on the heels of the $78 billion in investments committed by public and private sector entities from the GCC over the last 18 months or so,” he added.

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