Property prices in the coastal city of Alexandria have risen considerably in recent months, especially in areas overlooking the Mediterranean Sea, where the price for one square meter of land has reached LE50,000. Prices for housing units in the city, meanwhile, now range between LE15,000 and LE30,000 per square meter, depending on location.
According to local real-estate expert Mustafa el-Kholi, the increases can be attributed to both the scarcity of land and to a recent government decree banning vertical construction. "The government allows building over only 65 percent of a given property, while the rest must be maintained as a green area, which has contributed to the rise in prices," el-Kholi said, expecting further price hikes in upmarket areas.
Ahmed Mattar, secretary-general of the Arab Federation for Real Estate Development, noted that real-estate prices in Alexandria had jumped by 200 percent between 2005 and 2008 and by 70 percent since the onset of the current global financial crisis. He urged the government to launch the "New Alexandria" project on the outskirts of the city in order to provide more space for housing projects.
Real estate broker Ibrahim Abdel Ghani said that Arab nationals from the Gulf States had been buying up more land than local residents, many of whom cannot afford the high prices. "This serves to push prices up even further," he said.
"Recent government restrictions on building have put some 80 percent of local real-estate companies out of business," complained Taha Abdel Latif of the Alexandria Businessmen’s Association.
Translated from the Arabic Edition.