CAIRO: Egypt could witness a “remarkable breakthrough’ in housing after 5 to 7 years, if various efforts are combined to achieve this, Undersecretary of Real Estate Investment Division at the Federation of Egyptian Chambers of Commerce (FEDCOC) Tarek Shoukri said late Saturday.
In an interview on al-Mehwar Channel, Shoukri ruled out the possibility to complete the Armed Forces’ low-income housing project and government’s social housing project, each aimed to build 1 million units.
Both projects are “great but unenforceable,” said Shoukri, citing difficulty in building more than 400,000 units within five years.
He attributed the difficulty to lack of contractors, workers and building equipments necessary for building “such large number of housing units which exceeds market’s productivity.”
“Egypt could witness a remarkable breakthrough in the field of housing after 5 to 7 years at least, only if various efforts are combined to achieve this,” added Shoukri.
“Egypt needs 500,000 housing units annually, while the social housing projects only cover a small part of low-income needs,” said Minister of Housing Mustafa Madbouli said in his speech at Egypt’s Real Estate Summit (ERES) conference on April 7.
Approximately 88 percent of the Egyptian countryside is deprived of sanitation services, said Mabouly, urging businessmen to launch initiatives to implement sanitation projects in their places of origin, as a step towards establishing corporate social responsibility.
Former Minister of Defense Abdel Fatah al-Sisi announced March 10 a low-income housing project of one million units with the aim of solving the housing problem among Egyptian youth.
The UAE-based Arabtec Construction in collaboration with the Armed Forces’ Military Engineering Authority (MEA) will implement the military project. In March Arabtec announced completing the design for the project, Youm7 reported.
The million-unit Social Housing Project was launched in the wake of the January 25 Revolution, but the project face many hurdles since then, Head of the Social Housing Program Salah Hassan told Al-Hayat channel late Friday.
“About 165,000 housing units are being built currently, and 50,000 units will be finalized nationwide in July,’ Hassan announced, noting that single people will a monthly salary less than 1,700 EGP and married persons with a maximum 2,500 EGP can apply for these units.
In an attempt to solve the low-income housing crisis, the Central Bank of Egypt’s (CBE) launched an initiative in February by offering 10 billion EGP ($1.4 billion) to banks to stimulate the mortgage sector.
Through the new initiative, CBE would lend banks operating in Egypt 10 billion EGP for 20 years to be lent to people of low-income and average-income at a 7 and 8 percent interest, respectively, to buy housing units in new urban communities, Youm7 reported.
The Egyptian banks started to activate the initiative after receiving its executive draft from the CBE.
The real estate sector is a main contributor to Egypt’s economic growth, affecting more than 90 industries. The sector represented 4.6 percent, roughly 80 billion EGP (U.S. $11.5 billion,) of Egypt’s GDP during fiscal year 2012/2013, and recorded a 5.9 percent growth rate, according to data from the Ministry of Housing.