A Guide to buying property in El Gouna
Buying property in El Gouna can be an exciting but daunting task. Much the same as buying property anywhere. But, in our experience, buyers and sellers alike can get unnerved by the different procedures and are skeptical about how easy it can be compared to buying property in the U.K. or other European countries – fearing that something, somewhere will catch them out. In any situation, it is advisable to read the fine print, but we at Kinney Smith have outlined 6 key factors to keep in mind when you begin.
1. Use an Orascom Approved Resale Broker
First an foremost, it is essential that you use an Orascom approved resale broker to help you search for, buy and/ or sell property in El Gouna. Orascom, if you were not aware, own and manage El Gouna. They oversee everything from education, to security. But they are essentially a development company, meaning that property development and sales are their top priority. For this reason, they take the buying and selling of property in El Gouna very seriously and they rely on only a handful of brokerages to represent them in selling property in El Gouna.
Where do you begin finding an Orascom approved broker? Right here. Below are a few approved brokers and it would be good advice to tell you to use only approved brokers.
2. Approval of sale
Once you have decided to buy a property, your broker will help you apply for the approval of sale. This approval, or reservation form as it is called, is simply a one-page document which displays the unit number and area, names of buyers and sellers and the agreed selling price. This, with copies of all parties passports or I.D. documents, gets sent to Orascom’s head office in Cairo. Naturally, Orascom want to keep El Gouna to a standard and will need to approve the buyers as well as the selling price before allowing the sale to go through.
This takes between 14 – 21 days to come back to El Gouna’s legal office at which time brokers, buyers, and sellers will be notified of the go ahead.
A deposit is required up front and can be paid before the application of approval of sale. The deposit amount can vary from broker to broker, but naturally, it secures a commitment from the buyer. The deposit allows the buyer to claim the rights to that property, and as soon as a deposit is paid, the property gets removed from the website and the market.
Deposits can be paid in hard currencies (Euros, Dollars and Pound Sterling) as well as Egyptian Pounds. But most sellers (in fact all of our sellers to date) only accept the bulk in hard currency and it is the responsibility of the buyer to make sure the seller receives the funds in a currency of the seller’s choosing.
4. Seller obligations
The seller is legally obliged to pay any outstanding amounts on electricity, water, maintenance and any other costs that the property has incurred. Orascom has your back here and will not let the buyer be responsible for these. Bear in mind though, Orascom provides scheduled maintenance and aesthetic work such as painting which the current owner is liable for. However, a negotiation can be made due to who will benefit. For example, we sold a property that was due painting works to take place within weeks of the sale going through. The buyer and seller agreed though, that since the buyer was to benefit from the repainted house, it would be his responsibility to pay for it.
But ask your broker to check if any scheduled maintenance tasks are upcoming . Brokers are kept out of these updates as emails go only to owners. But the information is not too hard to find.
The dreaded word. What fees will come up in this whole process? As a buyer you incur no fees. The seller is liable for all fees. These include broker fees, transfer fees and the previously mentioned rates. Bear in mind though that when you sell the property, you are liable for fees. Transfer fees to Orascom, legally known as assignment fees can range between 3% and 5% depending on how old the property is.
6. Currency exchange
As mentioned, transactions are made in hard currency. It is the buyers responsibility to exchange and transfer / deposit any monies into the seller’s account. In our experience, Arab Africa Bank have offered the most straight forward process and so we recommend using them.
Written by Kinney Smith Prestige Living
Photography Kinney Smith Prestige Living
If you’re looking to sell property in EL Gouna, please go here…