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Originally Posted by distant dreamer
Agree with points 1 & 2 and the first part about beachfront property in third point. However, would be surprised if property in Hurghada performed as well as in the "resort communities", such as El Gouna & Sahl. This was taken from Orascams website about property prices in El Gouna:
"In El Gouna, OHD’s model project, real estate value has increased dramatically. Over the last five years property value has increased four-fold. Currently, El Gouna still retains a large land bank for future development"
I believe that places like El Gouna will get more and more popular with holidaymakers as the word spreads about them.
They will attact a different holidaymaker to that of Hurghada, probably more upmarket and maybe people that would prefer an exotic holiday, but with a more "European" feel, where they feel more secure. Also there should always be a resale market in places like El Gouna, as it is exclusive and many wealthy Egyptians want holiday homes in El Gouna and indeed already own there.
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DD,
Whats the completion date for these resorts and how many apartments along with hotels are being built???
My point is that the build time for these resorts are substancial, so in the main there building sites for long periods of time. Even if your development is complete, there are other developments on the resort that are still being constructed so you have a completed apartment sorrounded by a building site.
Once the resort is complete it also takes time for it to establish itself. These resorts also charge premium prices for the apartments, where as in my opinion, the smaller high quality resort in a good location costs less, build time is shorter and your return on capital is higher over a short period of time.
Unless you have a 7-10 year plan on a large resort, then in my opinion money is better spent elsewhere. That's not only my opinion but my experience from investing in Brazil and Morocco, especially in Morocco where they are building a mega resort called Saidia on the northern Medeteranian coast of Morocco. Smaller developments have seen substancial higher capital appreciation than this mega resort which is due for completion 2010.
Regards
RED