Real estate developers halt property sales as building materials’ costs soar in Egypt

Real estate developers halt property sales as building materials’ costs soar in Egypt

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Many real estate marketers have received messages from development companies to halt selling of their residential units until further notice. There is severe confusion in Egypt’s real estate market as prices of building materials soar due to the Russian-Ukrainian war and the devaluation of Egyptian currency.

The Central Bank of Egypt (CBE) clarified in a statement that the Russian-Ukrainian conflict led to an increase of domestic inflationary pressures, consequently, the Monetary Policy Committee decided to increase the key policy rates by 100 basis points.

Tarek Shoukry, Chairperson of Real Estate Development Chamber at Federation of Egyptian Industries, attributed the price hike of real estate during the last period to higher cost of construction materials, pointing out, “steel prices spiked by around 40% and cement by about 50%.”

He added that all finishing materials have increased in proportion to the convergence of steel and cement. The cost of construction has also increased, and it has become imperative for any developer who will commit to the construction process to put these new burdens in his financial accounts.

Shoukry further noted that raising the basic interest rates also affected real estate prices, due to the impact of the dollar’s price on many imported things, such as aluminum