Safe houses: Cairo’s residential housing market has been “gaining momentum owing to the continued fear of further devaluation” even as developers hike prices, global real estate consultancy firm JLL said in a statement (pdf) announcing its most recent quarterly Cairo Real Estate Market Overview. Heightened demand and soaring inflation have triggered a significant rise in property prices in the capital, with average prices in Sixth of October rising 40% in 3Q 2023 and 45% in New Cairo, according to the report. Prices in both areas were 38% higher than the previous quarter.

Driving the trend: Many people are deciding to invest in real estate to hedge against a volatile EGP, driving up demand and causing prices to rise. Developers have also been hiking prices to offset the impact of inflation, leading several to report record sales figures this year.

Rents and deliveries are on the rise:

  • Residential rental prices continued their rapid rise in 3Q, increasing 22% y-o-y in Sixth October and 18% in New Cairo.
  • Unit deliveries rose about 17% on the previous quarter, with around 7k residential units handed over during the three-month period. This brought the number of units in major gated communities to 262k. Up to 9k new units are expected by the end of Q4.

New foreign ownership laws in the pipeline could give the industry a further boost: JLL expects the plan to lift the cap on the number of properties foreigners can own to further boost the market, as foreigners — especially from the Gulf — purchase holiday homes and second homes.

It’s a different story for the commercial property sector, which remains “subdued”: In contrast to residential units, the average office rent in Cairo decreased by around 3% y-o-y, settling at USD 361 per square meter per year, according to the real estate consultancy firm. While landlords initially raised rent prices in anticipation of a currency devaluation, rates stabilized as the threat became less immediate, according to the report. Office vacancy rates rose to 12% from 10% recorded during the same period last year.

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