Gulf Investments Expected to Revitalize Egypt’s Real Estate Market Amid Slowing Local Sales
Egypt’s real estate market is witnessing a noticeable slowdown in local sales, driven by rising property prices and weaker domestic investment activity. However, a new report by global consultancy Knight Frank predicts a surge of Gulf investments into Egypt’s property sector this year, offering much-needed momentum to the market.
$1.11 Billion in Gulf Investments Expected for 2025
According to the report, titled “Destination Egypt 2025,” affluent investors from the Gulf are projected to channel $1.11 billion into purchasing second homes in Egypt — including $709 million from Emirati buyers and $403 million from Saudi investors.
The total value of real estate purchases in Egypt is estimated at $1.4 billion, with Gulf-based buyers accounting for 78% of that amount. Knight Frank noted that this trend underscores Egypt’s growing appeal as a second-home destination for wealthy regional investors.
Surge in Foreign Real Estate Demand
Foreign demand for Egyptian properties has climbed sharply, with real estate export revenues reaching $1.5 billion since the beginning of 2025 — up from just $500 million in 2024, according to Tarek Shoukry, head of the Real Estate Development Chamber at the Federation of Egyptian Industries.
Mohamed Rashid, board member of the Real Estate Development Chamber, told Erem Business that the rising Gulf appetite for Egyptian properties reflects regional confidence in the stability and long-term potential of Egypt’s real estate market.
He attributed this growing interest to several key factors — including the rapid urban development of new cities, improvements in the legal and regulatory framework, easy air connectivity, and competitive pricing paired with high-end services.
Rashid added that Gulf investors are primarily targeting New Alamein, Ain Sokhna, the Red Sea region, as well as affluent districts in New Cairo and Sheikh Zayed. Egyptian developers, he noted, are increasingly adapting their offerings to meet Gulf buyers’ preferences by integrating hotel-style services, professional property management, and seasonal rental options.
Key Drivers Behind Gulf Demand
Ayman Abdel Hamid, Managing Director and Vice Chairman of Aloula Mortgage Finance, identified five key drivers fueling Gulf investment in Egypt’s property market. Chief among them is the strong U.S. dollar, which makes Egyptian real estate significantly cheaper for Gulf investors. Other contributing factors include Egypt’s strategic location, mild climate, security stability, and the emergence of smart cities.
He expects sustained demand for coastal destinations such as Ras El Hekma and the Red Sea, particularly as Egypt launches new large-scale tourism and residential projects in those areas.
Local Sales Still Under Pressure
Despite strong foreign interest, Abdel Hamid cautioned that external demand alone cannot offset the slowdown in domestic sales. While annual real estate sales in Egypt exceed EGP 2 trillion, the country has generated only about EGP 75 billion in real estate export revenue since the start of the year.
He explained that the slowdown is most pronounced in the high-end luxury segment, while demand for mid-income housing remains steady. Egypt’s housing market, he added, faces a persistent supply gap, as annual demand stands at 500,000 units, while actual production reaches only around 250,000 units — leaving a shortfall that mainly affects middle- and low-income households.
Caution Over Overreliance on Foreign Capital
Rashid warned against overdependence on Gulf capital as a primary growth driver, noting that most Gulf investments are concentrated in the luxury and tourism sectors. He emphasized that while foreign inflows provide valuable liquidity and confidence, they cannot alone resolve the domestic slowdown stemming from high property prices and reduced purchasing power among Egyptian buyers.
With substantial Gulf investments on the horizon, Egypt’s real estate market could experience renewed vitality — but experts agree that sustainable recovery will depend on restoring affordability and boosting local demand alongside foreign interest.