Egypt’s Real Estate Market Awaits New Measures

Participants in the Egyptian real estate market are complaining about delays in deliveries, non-compliance with the level of execution and finishing stated in contracts, or the imposition of additional fees or amounts on the value of units in violation of the contracts.

Clients in various projects of more than one developer complain about violations and the failure of companies to adhere to the contracts concluded with them, as well as the failure to meet delivery deadlines or issues related to delayed installment payments owed by the client.

On the other hand, when the buyer fails or delays in paying some installments, the development company demands the termination of the contract.

Norhan Sadiq, one of the victims of a real estate development company operating in East Cairo, told Al Arabiya Business that she contracted for her unit in the project more than two years ago. When the time for delivery came, the company sent her a letter demanding she pay 1,250 Egyptian pounds per meter for utility connection to the project, which was not stipulated in the contract. She had contracted to receive a fully serviced unit at a specified value in the contract.

Sara Khattab, another victim of the same company, said, “I was surprised that the company put my unit up for sale because I asked the company to retract its demand for the utility fees, which were wrongfully and unlawfully imposed on us and other owners, in violation of the contracts.”

She added that the company’s president told protesting buyers, “I’ll sell the units, and you can take your money back.”

He added that any victim who gets a court ruling against the company will not see it enforced, as the company will re-sell the units itself.

Abeer Issam, a member of the Real Estate Development Chamber of the Egyptian Federation of Industries and President of the Arab Council for Businesswomen, said the chamber is currently working on drafting a unified or similar clause in real estate contracts to ensure the rights of both developers and clients alike.

Issam told Al Arabiya Business that this clause will be legally drafted by real estate consultants in coordination with the legislation of the House of Representatives to regulate cases of customer payment delays or developer delivery delays, as well as to regulate price increase clauses.

She added that the integrated proposal will be presented to the Minister of Housing during the second developers’ meeting next month.