Egypt has been growing popular with tourists from around the world and visitor numbers have been increasing at a rapid rate. More recently Egypt has also been looked at by increasing numbers of property buyers. Most people are currently favouring the security of established markets, because the emerging markets have not shown the growth they were supposed to.
However, this growth has only been postponed by the credit crunch, in most cases the forecast growth is still set to become a reality. Egypt is one of those cases. Below is 5 reasons why anyone who fails to consider Egypt property will be missing out in a big way.
1: Cheap Property - Exceptional Rental Yields
Egypt is known for having among the cheapest property in the world. On the Red Sea Riviera, which encapsulates some of Egypt's fastest growing tourism hot-spots -- most notably Sharm el-Sheikh and Hurghada -- studios start from as little as £10k and you can buy a luxury 2 bedroom apartment for less than £50k.
The average rent for such properties is around £300 per week and occupancy of around 15-20 weeks per year is currently being achieved. The result is a gross rental yield of 12.5% on Red Sea Riviera property. Now you can understand why so many Sharm el-Sheikh and Hurghada properties come with guaranteed rental yields of 8% and upwards.
Another great thing about the Red Sea Riviera is that most of it is protected by the government, so it will never be overdeveloped. This will ensure demand always outstrips supply keeping prices going up.
2: Rising Tourism Set to Increase Occupancy and Yields
In an interview with Write About Property earlier this year, the Association for British Travel Agents said that tourism to Egypt from Britain had been growing at around 20% per year for the last few years, and forecast that the strong euro would see growth hit 25% this year.
3: Low Crime Rates
Often the only negative about an emerging market is its crime rate. This is not the case in Egypt. Though the Sharia law system has attracted some negative press in recent years, this is mostly because of extreme interpretations of it, for the most part it is a fair system and one that is hugely succesfull in keeping crime to a minimum. This means that those who buy Egypt property can do so in the knowledge that they and anyone else who uses the property will be safe, and so will the property when it is not in use.
4: Massive Economic Growth Set to Push Prices Upward
People often forget, but Egypt is a part of Africa. This is forgotten, because Egypt is an Arab state and is heavily active in Middle Eastern politics. No matter, Egypt is geographically part of Africa, and like many African states that have secured peace, Egypt is currently making the transition between being a third world country, and an industrialised middle income nation -- with a roaring services sector.
This can be seen in World Bank reports, which show how Egypt's economy has changed from having agriculture as the largest contributor to GDP, to having industrial sectors taking over as the largest contributor, and then the services sector knocking even the industrial sector back into second place.
The same can be seen in most emerging markets, as the advent of budget airlines and IT technology becoming affordable to the masses triggered massive growth in tourism, services outsourcing, and domestic services growth.
However, Egypt is one of the fastest emerging economies in the world. According to the CIA World Factbook the Egyptian economy has grown at 7% per year since 2006.
The International Monetary Fund is forecasting 4.7% growth this year and 4.5% next year -- not bad for a global recession. Over the next few years Egyptian economic growth is forecast to average between 6% and 10% per year. This will cause property prices to rise by at least the value of inflation, -- as materials and labour cost more -- in Egypt that is about 10-15% per year.
However, in rapidly emerging economies it is not uncommon for prices to grow much faster, anywhere up to 30% per year.
5: The Perfect Tourist Package
Egypt has the perfect tourism package: great climate, long-season and great beaches. Because it is very early in its emergence it also offers the opportunity to enjoy the kind of cheap holiday that just isn't possible in Europe anymore. This means it is excellent for you and your family and friends to enjoy holidays in your property, as well as making the fantastic rental yields mentioned above.
Article Provided by Azure Overseas, view property for sale in Egypt with Azure Overseas now.
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