WHY INVEST IN EGYPT

Egypt

"Gem Estates has homed in on the Red Sea Resort of Hurghada. The stage is set for the next big thing..."

Egypt is a surprisingly large country, ranked 30th in the world, twice the size of France and four times the size of the UK, yet because of the arid nature of the landscape, only about 5.5% of the surface area is populated and concentrated along the Nile Valley and Delta – Egypt’s lifeblood - in cities such as Cairo and Alexandria.

Egypt could be labelled as the oldest tourism destination in the world. The inventor of the package tour, Mr Thomas Cook, was taking parties up and down the Nile from as early as the 1860s and today millions of people every year follow in their footsteps and take themselves and their cameras to marvel at the pyramids and the monuments of ancient Luxor. However, alongside these amazing man-made structures are the natural wonders of the eastern and western deserts, Sinai and the Red Sea which protects fantastic coral reefs in its warm waters.

GEM Estates has homed in on the Red Sea resort of Hurghada as it provides the perfect blend of ingredients for a beach holiday plus the added value of golf and diving, two of the world’s fastest growing sports, ideal
conditions for property speculation. The crystal clear waters of the Red Sea with spectacular coral reefs teem with marine life all underneath warm sunny skies. Famously, the Red Sea was Jacques Cousteau’s favourite underwater playground. A stay in ‘modern’ Egypt does not however mean that ‘ancient’ Egypt has to be forgotten. From Red Sea resorts such as Hurghada it is possible to sample Luxor or indeed Cairo, by way of an organised coach trip returning within a day.

Competing with Eilat (Israel) and Dubai (UAE), the Red Sea resorts often win out as they are affordable, hospitable and medium-haul as opposed to long-haul, for northern European travellers. As a result, homes within purpose-built resorts are springing up alongside luxurious hotels at an impressive rate; the stage is set for ‘the next big thing’.

WHY INVEST IN EGYPT

CLIMATE *****

Egypt has a desert climate, with hot days and cooler nights and the sun shines all year round. There are just two seasons: a hot, dry summer from May to October and a slightly cooler winter from November to April. On the Red Sea coastline, minimum winter temperatures are around 24°C, (‘winter’ suddenly seems to be an inappropriate word) and maximum summer temperatures can hit the early 40s °C, but extremely hot days are made more than bearable by the prevailing northern winds. Five stars as the only packing essentials are sun cream and a hat, regardless of the time of year.

ACCESSIBILITY *****

Due to its longevity as a holiday destination, this Middle Eastern country is well served by air from most of northern Europe. Egypt can be reached by direct flight from the UK within five hours and many carriers including British Airways, Thomson Fly and Excel Airways fly direct to Hurghada, a resort that GEM Estates has tipped for future success. Jet lag needn’t ever be a concern as Egypt sits just two hours ahead of GMT. Five stars – winter sun in just five hours by direct flight.

ECONOMY *****

Egypt has one of Africa’s most prosperous economies and is fortunate to have tourism, oil and gas to its advantage. Tourism is Egypt’s largest money-earner, followed by tolls on the Suez Canal, and then exports of oil, petroleum products, textiles and natural gas. The country is classified as middleincome and continues to record economic growth. In its annual report, the IMF has rated Egypt as one of the top countries in the world undertaking economic reforms. Egypt has been a republic since 1953 and President Mubarak has been in place since 1981 and is now serving his fifth term in office (last voted in in 2005). He is the leader of the ruling National Democratic Party and his presence fosters stability. Five stars.

TOURISM *****

Statistics released by the Egyptian Tourist Authority (ETA) state that over one million Brits visited Egypt in 2006, a giant 23% increase over 2005. Brits make up the largest chunk of Egypt’s overseas visitors and not only have they increased in number but also by the length of stay. British tourists stayed for a total of 9.1 million nights in 2006, that’s 21% more nights than 2005. The ETA also confirmed that a record 9.81 million tourists in total had added 7.6 billion dollars to Egypt’s economy in 2006. Tourism Minister, Zoheir Garranah, has no plans to rest on his laurels and with the launch of a multimillion pound advertising campaign at the back end of 2006 entitled “The Gift of the Sun” he hopes to attract 16 million visitors annually by 2014. Egypt also has a brand new tourism logo and official website www. egypt.travel in six different languages. Garranah vows to improve service and educate bazaar merchants in being ‘less
pushy’ via a Tourism Awareness Project for the Egyptian people beginning with print and TV advertising campaigns bearing the slogan “Tourism Benefits Everyone”. The tourism market is now making a distinct shift towards the ‘high end’ with the Red Sea resorts taking centre stage.

PROPERTY MARKET ****

The property market is in its early stages and set for a period of prolonged growth. Capital growth is difficult to assess due to the infancy of the market although 25% is predicted for 2006 once figures are in. A Sir Norman Foster co-designed resort at the southern tip of Hurghada is selling property at ten times the price of neighbouring developments showing the high expectations for the Red Sea resorts. Foreign nationals are entitled to purchase and own property in Egypt with some minor restrictions on the number of units and square metre size. Property in Hurghada is freehold, unlike the predominantly leasehold market in Sharm El Sheikh. There is no capital gains tax payable on the sale of properties, and if you are a British citizen living in the UK then you’ll also avoid inheritance tax thanks to a reciprocal agreement. Four stars due to the infancy of the market.