credit crunch

[propertastic]

We spoke to Zeiad about escrow accounts for some developments. The problem he said is that any lawyer holding an escrow account will be taxed on the money passing through the account - this is why they don't like them in Egypt.

So it's only really an option for escrow accounts being held by lawyers outside of Egypt.

 

[Alan Cockayne]

Maybe this is correct Peter and Nick. Sometimes even Lawyers don't like to put their names to papers. It means they have to be accountable.

I think the Egyptian government love to find any method to tax both Egyptians and foreigners, even though it's sometimes unethical and in many cases elsewhere, illegal . Investors are seen as "Cash-Cows" or a "Gray-Train" of income to officials. This "Egyptianism" has to change

I found an Egyptian development company charging 10% of the puchase price, as a default, for using an Escrow Account for stage payments over the build period.

What planet are some developers living on?

Readers, you have the right to question payment schemes. It is your money and your choice to buy from them. Your agents are there to assist you in every way possible and should be unbiased.

Alan Cockayne

 

[satanmademedoit]

Credit crunch is defo affecting property sales in Sharm.
We are buying here and amazed at how long properties now have been on the market for.
Estate agents are telling us that people are still looking but are not coming up with the cash.
Have offered way below asking prices and are being accepted.
Not good if you are looking for a high investment return in the short term but looking good for long term.

 

[Elliot Clark]

not really

 

[petehall]

Has the credit crunch affected egypt, have prices started to drop, developments slowed down etc ?

hi,
you will read everywhere that egypt is immune to the world's property crisis, i personally don't agree anywhere is immune at present.
I can't see that amount of building sustained anywhere and oversaturation will occur, not if but WHEN.
I am interested myself and looking at property, but will probably not buy, if i did it would almost certainly be a finished or almost finished unit.
I also would not buy for the sole purpose of investing at present.
look into what has happened on bulgaria's 'black sea coast' it was booming, now huge amounts of empty, unsold, non completed properties.
ok bank interest rates are totally crap but for the moment that is where my cash will be staying.
just my little opinion..you must use your own common sense, but also remember in egypt they don't do 'bank guarantee's on offplan's.
cheers, ph

 

[Alan Cockayne]

Egypt. - Global Immunity ?

hi,
You will read everywhere that Egypt is immune to the world's property crisis. I personally don't agree anywhere is immune at present. I can't see that amount of building sustained anywhere and oversaturation will occur, not if but WHEN. Just my little opinion..
You must use your own common sense, but also remember in Egypt they don't do bank guarantee's on offplan's.
cheers, ph

This "Buyer's Market" looks set to continue till 2011 and those having spare cash or equity can find bargains in Egypt. In doing so their registrations look like things are fine. Actually these comments are just media hype as some projects will soon be seen to close. Just as Dubai feels the clampdown and banks pull in their loans, so will Egypt find the squeeze.... I do hope those in high office read these posts.

This is not all bad news for investors. If your lawyer's contracts are strong, the penalties for failing to deliver are harsh. The tide is turning with cases being heard as I type. And the government are not at all happy.

In other countries there are good projects meeting the economic slowdown head on. Instead of using client monies to build, they actually give interest on payments while their properties are being built, (like borrowing your money instead of hijacking it.)

Instead of putting a surcharge on payment plans, good developers give incentives to buyers with cash stage-payments (other than pre-release discounts.) Instead of leaving a development standing still, project managers should be offering more incentives through genuine marketing and their agents should be more accountable. Satisfied customers come back for more.

Anything would be better than complacency. Egypt is not immune to global forces.

Alan.