GBP = Gonna Be Problems?

[propertastic]

I was just waiting in the bank when I happened to glance at the GBP/EUR cross rates.

The GBP is down 10% over the course of just a few weeks. I knew things were bad with GBP, but I didn't think that they were that bad!

I haven't been following the GBP/EGP corss-rates but, as I know that it is the GBP that's doing badly rather than the EUR that's doing particularly well, I can imagine that the GBP has falled a similar amount against the EGP.

Today, this is not having an effect upon buying prices because many of the major developers use GBP as their base price.

However, if this is not just a blip on the behalf of GBP (I'm no economist and so I don't know for sure) then logic says that the developers' costs are going to rise and that they are going to have to raise prices in order to compensate.

This comes on top of drastically increased costs of materials, as has been previously discussed on this forum.

What's the bottom line?

The time to buy in Egypt is NOW. I can't see any way that developers are going to be able to hold prices at today's levels for more than a few months at the most now, unless the GBP makes a swift recovery.

I would say that a 20% increase would be the minimum in order for developers to simply stand still - never mind any changes to prices as a result of changes in the supply and demand situation.

For those who do buy NOW, these prices will lead to an immediate capital increase in your property or properties to the same value.

So for all your procrastinators who are still thinking about it - it really is now or never if you want to take your place on the escalator.

[realestatemart]

Sure that is a correct expectation Egypt Real, first the cement prices are 25% more than last week, and the prices for building blocks is 100% more so can you imagine how much the prices of the properties will be within next weeks??? please if want to invest or buy a property it should be now

[dave99]

Originally Posted by realestatemart

Sure that is a correct expectation Egypt Real, first the cement prices are 25% more than last week, and the prices for building blocks is 100% more so can you imagine how much the prices of the properties will be within next weeks??? please if want to invest or buy a property it should be now

Serious doubts about those prices increases

My cement and bricks are not increasing by the percentages that you are quoting.



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[propertastic]

Originally Posted by dave99

Serious doubts about those prices increases

My cement and bricks are not increasing by the percentages that you are quoting.
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What about the slumping pound?

Is this going to cause you any problems?

[propertywatch1]

I have noticed before that the pound to le drops every so often but it has always gone back up.
I cant remember the rates today in the HSBC but i do remember that they are increasing again.
It was 10.36 le to £1 the other day which is big drop from the 11.47 le to £1 before Christmas...especially over a large sum ie buying property here or developing.
As you say it will hit developers more than the purchasers who mostly buy from UK based agents in Sterling any way.

[dave99]

Originally Posted by propertastic

What about the slumping pound?

Is this going to cause you any problems?

It's all part of the risk - not that any of the "commentators" on the forum would believe that developers take any risks - they seem to think that every price increase is just "profiteering".

I would hope that most developers who take payment in British Sterling, like me, have already "hedged" their bets on currency
- as long as the project is over a sensible period of time (at least 12 months) it should even out.

It does however make the existing buyers "quids" in since their price has been fixed (unlike in some other countries).

New buyers may well get a much better deal "TODAY" than in a months time if the pound does not bounce back.


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[andyk2]

Hi Guys,

Had a quick look at the rates compared to a year ago (XE.com - The World's Favorite Currency and Foreign Exchange Site has historic rates). The £ has fallen about 4% in the last 12 months against the EGP, but was at an all time high in July. It had to drop back a bit, and is weak at present against a lot of currencies. Imagine it will float around in a +/- 5% window for most of 2008.

Andy

[awahee123]

I think it's always going to be the case with the exchange rate,Does it cause a major concern for joe bloggs?, probably not.
Obviously may have some implications for the foreign developers.