Ready-to-move-in or off-plan properties?

[Alan Cockayne]

It is the opinion that 2010 will see a significant move towards buying properties in Egypt that are built and ready to move in. However, their economy is heavily dependent on cash and the reduction in off-plan sales will effectively slowdown construction even further.

With a reluctance for Egypt to go down the mortgage route, surely it would be wise for Egyptian developers to at least complete something that is saleable rather than have endless disputes.

With regards to completed developments it can take over a decade to be classed as really finished. Delta Sharm is now regarded as a good project after 18 years in the making. El Gouna Estates around 10 years and still expanding. Surely these are models to aspire to.

That said, their rentable value could be a model used for property tax evaluation as very few unfinished projects are rentable without full services.

Opinions please.

Alan Cockayne -

p.s. A Happy New Year to all readers.

 

[Georgina]

El Gouna celebrated its 20th anniversary in 2009! And it is still growing and still selling off-plan and aiming more and more upmarket. The new Super Yacht Marina is looking beautiful and they say 90% of berths are booked. It is still very quiet around this new area and it must be tough for the new businesses opening up there.

For sure anyone doing their homework and reading the forums will be completely put off about buying off-plan in Hurghada. And even the properties that have been completed there are very few where owners are satisified with the finish and promise of services.

At least in El Gouna it is a mix of Egyptian and foreign owners so we are paying Egyptian prices for carpenters, electricians, plumbers, etc. We call maintenance and someone arrives within one hour and one small job like unblocking a sink, or connecting a new light fitting costs around LE15.

Sahl Hasheesh is looking beautiful and my friend has received her apartment in El Andalous. Quality is excellent and the way they have furnished and decorated the entrance to the building is stunning. But Sahl Hasheesh has been under construction for years. I first went there in 2004 so it must have started quite a few years before that and still a ghost town so not sure who will be renting these beautiful apartments.

Orascom is the only company I would trust to buy off-plan. Anywhere else I would only consider a resale and do my homework about whether existing owners are happy with the way the building is managed. Especially considering the high maintenance charges on some of the buildings targetted for the foreign market.

 

[El Gouna Property]

El Gouna celebrated its 20th anniversary in 2009! And it is still growing and still selling off-plan and aiming more and more upmarket. The new Super Yacht Marina is looking beautiful and they say 90% of berths are booked. It is still very quiet around this new area and it must be tough for the new businesses opening up there.

For sure anyone doing their homework and reading the forums will be completely put off about buying off-plan in Hurghada. And even the properties that have been completed there are very few where owners are satisified with the finish and promise of services.

At least in El Gouna it is a mix of Egyptian and foreign owners so we are paying Egyptian prices for carpenters, electricians, plumbers, etc. We call maintenance and someone arrives within one hour and one small job like unblocking a sink, or connecting a new light fitting costs around LE15.

Sahl Hasheesh is looking beautiful and my friend has received her apartment in El Andalous. Quality is excellent and the way they have furnished and decorated the entrance to the building is stunning. But Sahl Hasheesh has been under construction for years. I first went there in 2004 so it must have started quite a few years before that and still a ghost town so not sure who will be renting these beautiful apartments.

Orascom is the only company I would trust to buy off-plan. Anywhere else I would only consider a resale and do my homework about whether existing owners are happy with the way the building is managed. Especially considering the high maintenance charges on some of the buildings targetted for the foreign market.

Dear Georgina,

you are quite right and I would also recommend resales with some exceptions like Azzura project in Sahl Hasheesh which will be delivered soon as well, and also regarding Sahl Hasheesh it is normal if you watch El gouna development since it started its same like Sahl Hasheesh took around 15 - 20 years to be developed and started to be El Gouna so I'm sure within 5- 10 years Sahl will be tottaly different

 

[Lidia]

I would not generalise. In my opinion developers in Sharm El Sheikh are far more less likely to fall behind schedules for their projects as more is built from the cash invested by the developer (depending on cash from sales) than other locations. Generally speaking, Hurghada also offers a huge number of small developments built by smaller developers more dependent on cash from off plan sales.
I have apartments on sale (in Sharm) where you can pay 20% and receive the key, allowing for immediate renting it out to get some cash whilst paying the remaining balance in installments spread over 24 months. This makes it accessible for clients.