Egypt Property One To Watch In Booming Middle East
News Posted On: 27 July 2010
Saudi Arabia's National Commercial Bank (NCB) has reported that the Saudi construction sector will account for a record 10.41% of GDP by the end of this year. The bank puts the increase down to an increase in government sponsored construction.
At present, 687 government sponsored major construction projects are underway -- 22% in the execution phase -- valued at approximately SR2.6trillion. According to NCB, contracts awarded in 2010 and 2011 are forecast to reach $64bn and $86bn, respectively.
The Middle East is currently a hot bed of construction and economic growth, as it has always been fuelled by the massive oil wealth.
One country we are watching very closely at the moment is Egypt, and in particular Hurghada. The tourism market is young and growing at a rapid rate. It is near-unique in the fact that the property market emerged hand in hand with the tourism sector.
Resorts were and still are being built to serve demand in both sectors; being sold to property investors, to come under the management of the resort or hotel for a guaranteed rental yield. This is good news for property investors for obvious reasons.
Of course the low prices help. With studios available from as little as £10k and in fully equipped resorts it is pretty much a no-brainer, especially with guaranteed rental yields.
A further factor is that much of the region is protected as part of a nature reserve. This will lead to demand outstripping supply and upward pressure on prices.
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