Current property prices for villas and apartments in Sheikh Zayed have increased to vary between EGP 4,000 to EGP 8,000 per metre.
“The variation in prices occurs according to the location of the properties, whether they are located in compounds or outside,” said Emad Fawzy, Sales Manager at El-Dar Company for Real Estate Marketing.
Those prices apply in areas including the seventh, eighth and ninth districts in Sheikh Zayed.
He added that last year’s prices varied between EGP 3,300 to EGP 3,800 per metre for apartments, whereas prices in compounds were valued at EGP 5,000 and EGP 6,000 per metre.
In the 6th of October City, apartment prices lie between EGP 3,000 to EGP 5,000 per metre, where the highest marks the price for apartments in compounds and the least is for those outside.
These prices are found in the first, second, eighth and other districts in 6th of October City.
Last year’s prices in the same zone, however, stood at EGP 2,500 and EGP 2,700 for apartments and those in compounds were valued at a rate of EGP 3,500 to EGP 4,000, Fawzy said.
This noticeable increase is attributed to several factors, including the increase in fuel prices, hikes in land prices, and the decrease in supply while demand is increasing.
“Some lands were offered in auctions by the 6th of October and Sheikh Zayed authorities at a price of EGP 4000 per metre, which is considered a high price,” Fawzy noted.
When adding these factors to other building costs, real estate dealers find their profit margins are low, and they either increase their prices or stop the building process. Prices offered by other dealers or companies remain high as the supplied amount is less than the demand, Fawzy said.
He noted that with today’s circumstances, it is better to buy land and keep them to be then sold after a year or two, rather than buying land to build on – which is what many are currently doing.
Moreover, the high prices offered in compounds control the market price, Fawzy said.
The services offered inside compounds, the possibility of buying using instalments and other facilitating offers made can surely lead the prices to be higher, however the rates are more than they should be, Fawzy highlighted.
Fawzy said that many are now unable to purchase with the price increase, highlighting that A and B classes are the ones most able to do so and most likely to currently purchase. He added that demand did not decrease, and that people tend towards buying now as they witnessed the huge growth in prices compared to last year and they fear more increase in the upcoming years.
As for his expectations for the prices in the coming period, he indicated that they are anticipated to grow from 10%-15% in 2015.
The 6th of October City and Sheikh Zayed are not the only places that witnessed the price hikes, as rates have increased in New Cairo and other areas in the Cairo governorate.
Earlier this month, Ehab Galal, project manager at Sawa Company for Real Estate Marketing, told Daily News Egypt that the prices of apartments increased in 2014 by approximately 15%. Galal outlined that he expects them to rise in 2015 to reach around 25%.
Furthermore Tarek Shoukry, chairman of the Arabia Group for Development & Urban Progress also revealed that prices for properties have generally increased in late 2014, due to a rise in the prices of building materials, as well as the high prices of lands offered in auctions.
He also expected that prices of properties will grow by 25%-30% in 2015, saying: “If someone wants to invest in real estate, then today is better than tomorrow.”