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Al-Zaieem
answers all your questions about Egypt. Ask him your question here.
Suburbia bound?
An unfinished villa in
the desert
Nadia asks:
Why did the price of land
in "Alkahera Al Jadeeda" drop?
New Cairo’s problems are part of a much larger social dynamic
plaguing the Cairo real estate market.
Five years ago, developers
were frantically buying up chunks of land on the desert outskirts of
Cairo. Optimism over the developing Egyptian economy fueled promises
of a Cairene suburbia complete with ranch houses, and abundant green
space. A building boom ensued and many upper-class Egyptians
reserved lots in one of the dozens of new housing developments that
cropped up. The New Cairo area was planned as one of the jewels in
this crown.
Since then, the Egyptian
economy has grown stagnant. An extended liquidity squeeze has halted
much of the construction in these new suburban developments. All of
the people who could afford to buy land in these areas (essentially
the top 10%) had already done so and the rest can’t secure the
kind of long-term mortgages that made the American suburbs blossom.
Egyptian banking law
doesn’t currently allow for these kind of mortgages.
The suburban push has also
been hindered by the natural clannishness of Egyptian family and
social life. The first wave of suburban pioneers has, so far, been
reluctant to leave behind tight-knit family bonds and move out to
the edges of the city.
Basically everybody is
waiting for everybody else to move out there first so they won’t
feel isolated.
But there’s hope.
While the economy remains
frozen, there’s talk that a long-rumored mortgage law revision
will pass through the Egyptian Parliament this year -- opening the
door to the 30-year variety and ideally enabling
middle-class Egyptian families to obtain their chunk of the suburban
dream.
The future is still bright
for New Cairo as well. American University in
Cairo is planning to move its campus out there -- which will take
several years, but should provide a much-needed boost.
Next question please...
Al-Zaieem
answers all your questions about Egypt. Ask him your question here.
Browse
previous Ask Al-Zaieem columns here.
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