Egyptian real estate developers are focusing on mid-priced residential property developments due to a fall in demand for luxury properties, according to a report by Markaz.

The current shortfall in mid-priced residential properties will most likely continue until 2012 and subsequently prices could be pushed upwards. However, once the country’s economy improves it is expected that developers will resume high-end projects, most likely within the next two years, but not to the same extent as previously.

The report stated: ‘Major developers have recalibrated their focus to mid-end segments which remain undersupplied, backed by concerns of oversupply in high/luxury segments. We expect the shortfall in mid-income housing to remain undersupplied during 2010-12, however, we expect developers to focus back on the high-end luxury segments when the economy strengthens from 2012.’
Egypt’s population is expected to grow at its natural growth rate of +2%pa, with income growth the key driver for real estate demand, it suggests. As more people get better paid jobs then a growth in demand for middle prices real estate is expected.