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Dive demand drives Red Sea property market.

Increasing interest in dive tourism has pushed up demand for property in Egypt's Red Sea coastal areas. A six per cent increase in tourists focused

on sub-aqua pursuits, in a segment identified by the World Tourism Organisation (UNWTO) as among its most rapidly expanding areas of commercial

activity, has boosted the seaside housing market.

The Egyptian Red Sea coastline is considered as one of the world's best and most influential diving destinations. It has all the attributes: totally

translucent water quality, unspoiled coral reefs and sheltered inlets. With a fastidiously protected environment in areas like Ras Mohammed National

Park, 30 kilometres from Sharm El Sheikh, Egypt attracts overseas divers by the million. Many of whom arrive to finish their Professional Association

of Diving Instructors, otherwise known as PADI, certification.

With 600,000 freshly qualified PADI divers emerging each year, this represents an annual growth rate of 6 per cent; a statistic which underpins the

success of resorts such as Hurghada, Sharm el Sheikh, Sahl Hasheesh and Taba. With a perfect marine landscape, that offers virtually one step off

the beach into pristine coral reefs, many former visitors are now looking for permanent second homes, from which they can both pursue their hobby as

well as rent them out to fellow enthusiasts.

An established expatriate community adds to the appeal and while prices have been going up, they are still reasonable, with a one bedroom apartment

in the popular town of Hurghada for example starting from US$ 54,000. Studios in Sharm el Sheikh are available starting from US$ 28,000 and from a

foreign investor standpoint properties are not subject to either capital gains or inheritance tax.

Egypt has become the premier medium haul destination from Europe, with a wide variety of budget airlines available able to complete the flight in 4.5

hours. Year round sunshine derives year round rentals and the general cost of living while rising is still extremely low compared with that of European

countries.

Developers are offering generous incentives to buyers and investors, including guaranteed rental returns, annual service and maintenance charges at

1 per cent of the purchase price and additional living equipment. There are plenty of completed properties available as well as off-plan which makes for a

more balanced real estate market. The fundamentals are sound, the climb in dive tourism continues and there are also a number of golf-side developments

coming to fruition to add to the sporting possibilities.

Copyright [c] Andy McTiernan. All rights reserved.

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Publication:Andy McTiernan Property & Economy Bulletin
Date:May 14, 2010
Words:422
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