Buying property in Egypt
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A guide to buying property in Egypt
Foreign purchasers have the right to own real estate and land in Egypt. Today the government recognizes the great value foreign investors in property have for the success of the economy and have set about actively encouraging overseas buyers to Egypt. This is more in evidence on the Red Sea Coast with many new foreign developers coming on board. New laws have been established to make the Egyptian property purchase procedure more secure. There have been many changes to the buying process over the years and these have increased confidence amongst foreign investors. Egypt still offers some of the best value property per square foot compared to any other country in direct competition with like for like properties. Below we have listed the key elements of any property purchase within Egypt, our over all recommendation is that Egypt is a safe and secure place to buy property and one that will offer great returns if a long term view is taken with the investment.
When you decide to buy
a property in Egypt you pay a deposit which then reserves the
property for you and removes it from sale until all the contracts are
in place. Then you will need to appoint a Lawyer to help with contracts.
Local lawyers will also help you through the best way to conduct business with the local people who have their own perceptions and customs which are important to be aware of. Although it is recommended by all to do some research, you are buying in a foreign country so always check and check again.
Currently there are no
mortgage facilities available to foreigners in Egypt, though
this situation is due to change in the near future with a new mortgage
law in Egypt, this will probably be based on the existing
foreign mortgage framework of a higher than average deposit with a term
time from 15-20 years. Although a lot of developers are now offering
new and varied ways of overcoming issues of payment plans, some of
these can be simply by done agreeing with the developer
Do remember that prices are still very cheap with apartments starting at around the £15k mark which makes the need for a mortgage less of an issue as opposed to countries like Spain and Portugal.
Property registration and legal fees for conveyance total around 6%.
Stamp Duty on property is payable by the buyer at 3%. The buyer will also pay a small inspection and measurement fee (approx £45).
Rental income can be taxable and the rates are around the 20% figure, do get advice on tax payable by you in the UK.
For British Investors Taper tax relief rules can apply on any investment you make a profit from but the properties cannot be sold for at least 5 years. Once again we recommend you get professional tax advice before making any purchases overseas.
There is no inheritance tax or capital gains tax in Egypt.
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