(MENAFN- Daily News Egypt) Egypt's Prime Minister Mostafa Madbouly has dismissed concerns about a Real estate bubble in Egypt, stating that the country is not at risk of experiencing such a phenomenon.
Addressing the possibility of a real estate bubble and its potential impact on the national economy, Madbouly emphasised that Egypt has not seen a decline in property values.
Mostafa Madbouly
He explained,“Instead, there is a cycle in the real estate sector involving periods of growth and slowdown, similar to any investment sector.”
“During times of slowdown, the government provides more facilities and eases conditions, which keeps real estate prices in Egypt stable,” Madbouly added.“Unlike some other countries, we have not seen a sharp drop in prices. Due to the high population growth, the demand for real estate remains high and sustainable.”
Madbouly also pointed out that,“Even if there is a slowdown at times, it usually lasts for no more than two years before things return to normal.
The sector has sometimes been criticised for monopolising investments by Egyptians and the state, but we need to review this perspective. Many countries' economies rely primarily on real estate development and the export of properties. I'm not just defending this industry, which is very important and will continue to be a part of the Egyptian economy, but Iwant to point out that every housing unit built contributes to the operation of more than 90 different factories.”
Madbouly's comments come following warnings about the possibility of a real estate bubble in the Egyptian market, raised by economic expert Hany Tawfik.
Tawfik stated on his official Facebook page,“I repeat my warning: when prices diverge from value, this is a bubble destined to burst. When the majority buy real estate not for housing but for quick resale at a profit during the next, higher-priced phases, this is a snowball that will end like a bubble.”
However, Abeer Essam, a member of the Real Estate Development Chamber at the Federation of Egyptian Industries, stated that Egypt is not experiencing a real estate bubble and that there is no such thing as a real estate bubble in Egypt.
On the contrary, she said, demand in the market remains large and continuous, with prices expected to rise in the coming period due to increased demand. This confirms that we are far from experiencing a real estate bubble.
Essam concluded that the state is making significant efforts to support and stimulate the real estate market, which is one of the most promising markets in the region, attracting both foreign and local investments.
To date, few real estate developers in Egypt have officially and directly addressed the possibility of a real estate bubble in the market.
However, some developers and market experts have shared their opinions on the matter. Their remarks generally highlight the resilience of Egypt's real estate market and the sustained demand, while also commenting on the dynamics of supply and demand and the significance of effective planning.
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