What is the Best Real Estate Investment in Egypt
What is the Best Real Estate Investment in Egypt?
Real estate investment aims to buy a residential, commercial or administrative property to rent, use or sell after several years. There is high demand for real estate investment due to the noticeably high prices, the increase in the investment return significantly in Egypt as a result of the increase in the population.
Also, choosing a guaranteed real estate project provides you with a great opportunity to make profits by increasing the price of the property multiple times. Real estate prices always rise in any area with the increase in demand for it. So, the property can be converted into an investment project at any time, through renting it and getting a fixed return, transferring it to a commercial or administrative project, or selling it after a period of time to take advantage of the price rise.
ROI on Properties
Real estate investment is the most appropriate way to preserve, even significantly increasing, the capital. You will not lose the capital’s value, because it is saved in the form of assets. It is well-known that the highest investment return in the world is 1% per month, i.e., 12% annually, which is the highest percentage in the real estate investment and often satisfies all investors.
In Egypt, specifically in Cairo, the annual return is about 5% and sometimes less. But it may be a satisfactory percentage for many investors and you will not pay much taxes compared to other types of investment. The value of the real estate tax in many countries in the Arab world are negligible in relation to the original value of the property.
Investing in a Unit in the North Coast Provides the Best Return on Investment in the World
In many cases, investors are afraid of renting the unit to others, although this provides them with a monthly investment return. They are afraid that the tenant will fail to pay for any reason, such as what happened during the spread of Corona, or his work will be affected. So, investors fear not receiving the money on time.
However, the North Coast is different from anywhere in all of Egypt. The demand for the North Coast is very high, although the period for spending holidays and benefiting from the unit may be in only 3 summer months during the year. But the purchase rate in the region is high and the demand for apartments is more than 60% of villas. In the case of renting the unit, the investor takes his money in advance to guarantee to obtain the investment return at first.
From 2018 to 2019, the demand increased by 170 percent within one year. The demand for real estate units in the North Coast increased significantly due to its beautiful atmosphere and charming beaches. Despite the short lifespan in which the investors rent units, it has been observed that approximately 8 and 9 million summer residents go to the North Coast in the summer. This means that the opportunity to invest in a housing unit in the North Coast is very guaranteed. You can buy the unit, pay its price in convenient installments, and rent it in the summer or use it to have a good time.
Reasons for Increased Demand and High Prices in the North Coast
If you have a look at the map, you will find that the North Coast is full of projects. There are only a few plots of land left where projects will be built soon. This means that a time will come and there will not be many units while the demand will still be high. At that time, you have owned a distinctive unit in a place characterized by increased demand with few units offered, so the opportunity to rent a housing unit will be valuable. The rental price will also rise and the value of the unit will significantly increase.
The return on investment in the North Coast reaches 10% and may increase. It is a very huge return on investment and is the highest in Egypt at all. But the biggest advantage is that this return is distributed over a simple number of times during 3 summer months, which means more benefit from the returns.
Real Estate Investment Problems When Renting the Unit to the Customer
There are also disadvantages to investment. In the case of renting a housing unit in Cairo or other areas, the most worrying problem is that the customer may be late in paying the monthly rent or unable to pay it for any reason. But this matter is almost impossible in the North Coast, as the customer will not get the unit until he pays first. So, there is no room for delay in the date and in the event of any problem with the tenant, the owner rents it to another tenant with ease due to the already high demand for units in the North Coast.
The second point is that the target class of renting real estate units in the North Coast is a higher class. This means that the customer pays this money for enjoyment and therefore there is no room for problems. The customer knows what he wants, and he actually pays this money to rent the unit without any problem. The monthly rent is not a part of the basic income of the tenant, as it is, in any case, some money to be spent on luxury.
But it is better to buy in any case from a real estate broker who sells and rents at the same time. It is easy for you to rent the unit and deal with the tenant and take the agreed percentage, and then give you the financial return without any effort from you. Also, as a result of his experience in the field, the broker suggests the places where the rental demand is increasing and takes over the task of renting the unit.
The Difference Between a Customer Who Rents a Unit in the North Coast or Anywhere Else
Most likely, the North Coast customers are very high-end customers with a high level and class. So, they pay attention to every detail and need a value unit furnished to a high standard. So, the North Coast attracts a higher class from inside and outside Egypt.
Also, the so-called summer furniture in a unit whose cost seems to be in the millions in the North Coast is not good at all. The final shape of finishing and furniture in the unit facilitates the process of renting it. Thus, the unit will attract a high-level customer, and therefore you need to change it quickly and re-furnish the unit within a year or two at the most.
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