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Will launching World Day to Combat Housing Crisis solve Egypt’s deficit? - Daily News Egypt

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Will launching World Day to Combat Housing Crisis solve Egypt’s deficit?

Launching such a day will not address real estate sector’s problems unless government takes real steps to address mortgage problems, says member of Real Estate Investment Division


Despite efforts exerted by the Egyptian government to overcome the housing crisis, demand continues to far outstrip demand.

The demand on the social housing projects that are being built by the government is very high and the existing units do not cover the citizens’ needs. Despite the existence of 7m uninhabited units, the crisis persists.

In light of this, demands were raised to launch a World Day to Combat the Housing Crisis on 10 January in an attempt to safeguard the peoples’ rights who do not have legal recourse due to ineffective and extinct laws.

Chairman of the Egyptian Contractors Alliance Omar Tahtawy, who launched the initiative, invited the heads of Arab states to attend the World Day to Combat Housing Crisis Conference.

Tahtawy revealed that 40% of low-income Egyptians are not able to apply for social housing projects developed by the government due to their extremely limited financial resources, noting that the aim behind launching this day is to launch a comprehensive urban renaissance.

“The current policies adopted by the government, such as expanding allocation of lands to the private sector, have led to pumping more investments into middle-income housing and neglecting social housing projects,” Tahtawy said. “The extent of the housing crisis has become a humanitarian tragedy that needs far-reaching policies to address poverty and lift the most vulnerable groups out of the miserable economic conditions.”

Combating the housing crisis requires the government to develop a comprehensive national plan to address the issue of informal settlements, that includes re-planning and the provision of infrastructure and facilities, and to improve the quality of life and public health within a specified period.

Despite the real estate sector in Egypt having grown by 420% since 2001, only 40% of Egyptians own their homes and 71% of the investment in housing units is developed by the private sector, while the government share is only 29%.

Regarding the uninhabited units, Chairman of the Housing Sector at the Ministry of Housing Nafisa Hashim said there are about 5.7m uninhabited housing units, some of which belong to the government while others are privately owned.

Hashim attributed this to the lack of utility connections to these units, among other reasons, on top of which is the inability of the owners to finish their units due to a lack of financial resources.

Member of Real Estate Investment Division at the Federation of Egyptian Chambers of Commerce (FEDCOC) and CEO of Beta Egypt for Urban Development Alaa Fikri said the housing crisis is mainly the result of deficiencies in the mortgage system.

Fikri said the mortgage system in Egypt faces many challenges that prevent it from making a powerful entry into the market. Launching such a day will not address the problems in real estate sector unless the government takes real steps to address the problems in the mortgage system, in addition to facilitating lands to be eligible for building units.
The reason the mortgage system is hindered is because of the large number of documents required from clients to receive funding, the long procedures and bureaucracy, and the high interest rates on financing units ranging from 14% to 17%.

Topics: Egypt Housing

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https://www.dailynewsegypt.com/2015/12/21/will-launching-world-day-to-combat-housing-crisis-solve-egypts-deficit/
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