Middle east property investment on the rise

With holiday and investment property prices at best static in most developed markets, the Middle East and specifically Egypt is attracting the interest of smart investors, many of whom are enjoying returns of up to 30%. This will not come as a surprise to those who know the Middle East well, as investors have been turning their backs on us and eurozone options since 2008.

Egypt’s relative stability in its region has enabled it to invest heavily in its tourism infrastructure and pass transparent land registry legislation due to be fully rolled out by 2012. The Egyptian government’s economic growth model is designed improve the living standards of the indigenous population by attracting inward investment from many smaller investors, thus spreading the risk and avoiding a Dubai-style foreign debt fuelled boom and bust scenario.

With relaxed rules around taking profits out of the country and highly competitive land and construction costs there is a solid foundation that is set to see foreign investors confidently pouring millions in to the country. According to Global Property Guide, the Egyptian property market grew by 14% in 2010 and the trend is continuing upwards in the experience of local developers.

Abdullah Sobhi, a UK based Egyptian property developer and CEO of Luxor Luxury Apartments, has seen demand for property sky rocket in the last 12 months with enquiries in January up 92% from last year. He went on to say: “A combination of low interest rates in the UK and eurozone inflation has made Egypt a popular and lucrative investment option. My investors who bought off-plan have enjoyed capital gains of over 30% and with annual rental yields of 18% expected to rise in the next three years; serious investors cannot afford to miss out on this market.