The Fifth Square Al Marasem Compound in New Cairo. AlMarasem Development
The consultancy said market activity continues largely as normal, with developers maintaining project pipelines and demand showing resilience, even as geopolitical uncertainty persists.
Pressure on the sector appears to be driven mainly by external factors, particularly rising energy costs, which are increasing construction and operating expenses. However, the impact has not yet led to widespread price adjustments.
In a related assessment, Fitch Ratings noted that Egypt’s financial system is entering the current period from a relatively stronger position, supported by solid banking sector fundamentals, including capital buffers, profitability, and foreign currency liquidity.
Costs rise, but prices remain stable
Catesby Langer-Paget, head of Savills Egypt, said the sector is facing short-term cost pressures linked to exchange rate movements, energy inputs, and supply chain disruptions.
He added that there are no clear signs of broad repricing across the market, with developers largely maintaining pricing discipline while continuing sales and delivery schedules.
According to Savills, many developers had already adjusted their pricing assumptions during earlier currency volatility in 2024, helping absorb part of the current cost increases.
Project pipelines also remain active, with new launches continuing across different segments, suggesting that developers are proceeding with planned investments rather than scaling back.
Demand supported by inflation concerns
Demand fundamentals remain intact, with property continuing to attract buyers seeking to preserve value amid inflation.
Savills said buyer enquiries remain relatively strong, supported in part by earlier stability in the Egyptian pound, with real estate continuing to serve as a store of value.
Long-term drivers, including population growth and urban expansion, are also sustaining demand across residential and mixed-use developments.
Developers take a cautious approach
The report indicated that developers have so far avoided abrupt shifts in strategy, focusing instead on sustaining sales, managing costs, and keeping projects on track.
Pricing decisions are being made cautiously, without sharp increases, reflecting what Savills described as a more disciplined approach shaped by experience from previous market cycles.
Regional investor interest has also remained steady, with Gulf-based developers continuing to pursue projects in Egypt, including large-scale developments along the North Coast.
This suggests continued confidence in the market’s longer-term prospects despite current uncertainty.
Outlook depends on regional developments
Looking ahead, Savills said the market’s trajectory will largely depend on how long regional conflicts persist and their impact on key variables such as energy prices and currency stability.
For now, the firm expects the sector to remain resilient, supported by steady demand, ongoing project activity, and sustained investor interest.
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