Member of the board of directors of the Egyptian Federation for Construction and Building Contractors (EFCBC), Daker Abdellah, predicted that the real estate market will witness an increase of 25-30% in prices, following the government’s decision to increase fuel prices.
Abdellah noted that unrealistic price increases are expected and are not in line with the real increase in cost resulting from the increase in fuel prices, due to the lack of market controls and the desire of a number of producers, traders, and real estate developers to make great gains.
Ashraf Diaa, managing director of ERA West Associates, said that the increase was excepted, whether the fuel prices hiked or not, but he expected that the increase may reach 25%.
For his part, Marseilia group chairperson, Sherif Heliw, said that the average natural price increases in the market range between 15% and 20%, which cannot be predicted by increasing the rate of price increases in the case of cutting subsidies on fuel, pointing out that the market cannot afford more price increases.
Heliw added the rate of fuel prices increase will be the same for the real estate units’ increase, noting that this increase will be totally borne by the client.
Meanwhile, Ahmad Zaini, head of the division said that the division of Building Materials at the Cairo Chamber said that new increases in gasoline and diesel prices would lead to slight increases in the prices of building materials.
Real estate prices will rise after at least 20%, as a result of the increase in fuel and electricity prices, according to Tarek Shoukry, chairperson of Arabia Holding and head of Real Estate Development Chamber at the Federation of Egyptian Industries.
Shoukry added that increase in property prices is always associated with cost, noting “the private sector is controlled by the industry’s input, such as construction materials, transportation, and labour. If there is a change in these inputs, the price of real estate will be immediately affected.”
© 2019 Daily News Egypt.