Brief Summary
This video discusses several key updates in the Egyptian real estate market, including the "Jaryan" project, the introduction of a national real estate ID system, potential changes to real estate tax laws, and developments in the New Administrative Capital. The speaker highlights the government's efforts to regulate the real estate sector, attract investment, and address challenges related to property valuation and taxation.
- The "Jaryan" project aims to create a new branch of the Nile River in 6th of October City, enhancing residential and tourism opportunities.
- A national real estate ID system is being implemented to combat address duplication and improve transparency in property transactions.
- Proposed amendments to real estate tax laws seek to adjust tax exemption thresholds to reflect increased property values.
- The New Administrative Capital is attracting significant investment, with ongoing tenders for land plots and increasing asset values.
The "Jaryan" Project
The "Jaryan" project, spearheaded by Misr Future, aims to create a new delta by drawing water from the Rashid branch of the Nile to an area near 6th of October City. This initiative involves major developers like Palm Hills and seeks to offer residents proximity to Sphinx Airport, the pyramids, and the new Egyptian Museum. The project intends to facilitate tourist rentals and is a collaborative effort between Misr Future for Sustainable Development and the Air Force, along with private sector companies such as Palm Hills, Mountain View, and Nation of Sky. The government views this project as integral to the New Delta project, with plans to divert 10 million cubic meters of water daily to reclaim 2.2 million acres for agricultural, real estate, and tourism activities. The project, covering 6.8 million square meters (1,600 acres), aims to provide a new Nile-side living experience in 6th of October City, akin to a modern Zamalek.
National Real Estate ID System
The government is implementing a national real estate ID system to address address duplication and fraud. Each property will be assigned a unique ID, accessible through electricity bills, to improve transparency and organization in the real estate market. This initiative aims to support digital transformation and streamline property transactions, enabling the government to monitor sales, transfers, and related taxes. The system, initially covering 19 million properties, will be managed by the provinces in coordination with the Real Estate Wealth Operation Center under the Administrative Control Authority. The goal is to create a comprehensive database of all properties, linking them to utilities and a new Egyptian Real Estate platform managed in cooperation with the Ministry of Communications. This platform will facilitate property sales and purchases, ensuring tax compliance and combating resale issues.
Real Estate Tax Amendments
Proposed amendments to the real estate tax law involve raising the tax exemption threshold from 2 million to 4 million EGP to align with increased property values. However, experts argue that this increase is insufficient, suggesting a threshold of 6 to 8 million EGP to reflect the doubling of property prices since 2013-2014. The difficulty lies in property valuation and tax collection, especially for owner-occupied residences. The speaker suggests that the tax exemption should be adjusted to maintain its original value relative to current property prices. An alternative approach, similar to that used in the European Union, would be to base property tax on the property's area rather than its rental value, with varying rates per square meter depending on the location and building quality. The Deputy Minister of Finance acknowledges that real estate tax affects a broad segment of the population and requires a clear, well-defined system to avoid legislative and administrative issues.
Developments in the New Administrative Capital
The New Administrative Capital is witnessing intense competition for land plots, with 32 companies vying for 16 plots in the eighth district (R8). The capital's asset value has increased from 280 billion to 350 billion EGP in 2024. The offered plots range from 14 to 60 acres. While some land tenders were expected to be finalized before Eid al-Adha, decisions on plots with multiple bidders will be made after the holiday, based on the strength of the competitors. The New Administrative Capital requires an annual maintenance budget of 5 to 6 billion EGP. The value of the capital's assets has significantly increased due to economic changes and currency devaluation.
