R
eal estate development companies in Egypt are offering extended instalment periods to make property purchases more accessible, particularly amid economic pressures and financial constraints. By providing longer payment plans with reduced down payments and monthly instalments, developers aim to attract more buyers and sustain sales.

    The trend of long-term instalment offers has gained momentum since Palm Hills announced a 12-year instalment plan across all its projects. Other companies have followed suit, extending payment terms up to nearly 16 years. This move coincides with relative price stability in the market, raising questions about its underlying reasons and potential impact on sales.

    According to real estate marketers, instalment periods vary based on project status, with completed projects typically offering shorter payment plans. Sales professionals attribute the rise in flexible instalment plans to three key factors: a slowdown in real estate sales due to government efforts to stabilize the Egyptian pound's exchange rate, anticipated lower interest rates and stable construction material prices, and the slowdown in mortgage financing.

    Developers now offer cash payment options with discounts ranging from 40% to 50% on unit prices. Ahmed Kadry, CEO of SAK Developments, highlighted the need for a more active role from the banking sector in real estate financing, as only 2% of sales are funded through bank loans. He urged the government to revise existing policies and introduce new legislation to facilitate financing.

    Ayman Sami, Country Head of JLL Egypt, noted that instalment-based systems impact the resale market, making it difficult for existing owners to resell their units. However, he dismissed fears of a market collapse, emphasizing sector stability despite ongoing changes. Ahmed Ehab, CEO of Madaar, stressed that housing prices in Egypt far exceed global averages, making homeownership less affordable due to rising land costs and construction material prices.

    To alleviate the financial burden on buyers, developers are extending instalment periods to reduce monthly payments. Ehab called for government intervention to regulate pricing in land offerings and ensure stable interest rates, describing flexible payment methods as a practical solution to current challenges in Egypt's real estate market. His company has introduced a nine-year payment plan with a 5% down payment, aligning instalment terms with buyers' financial capabilities.