By: Farah Montasser
Interviews Conducted By: Julian Nabil & Lobna Waseem
Real estate companies and projects are everywhere across Cairo today and the temptations and payment plans are very attractive given the fact that the return on investment- when it comes to the Egyptian market- is beyond profitable. But with all those billboards and TV commercials featuring the nice spacious houses, gardens, and facilities… with all this Utopian life, where do you go and what to do when you are actually spending a fortune on a property? Invest-Gate presents the most common mistakes to avoid when making your next property investment as advised by some local experts, including Vice President of Coldwell Banker Egypt and Coldwell Banker New Homes Mohamed Banany, Sales Director of Oriental Urban Development (OUD) Ahmed Zaalouk, and Development Manager at Aqarmap Ahmed Abdel-Fattah.
Going To Anonymous/Dubious Developer
With all the billboards and commercials and new cities being developed and, again, given the attractive and feasible payment plans, one would be intrigued to buy a first or a second home in this Utopian life we see on TV. But steady now, you need to first and foremost choose the developing company carefully and wisely.
Fact check the company’s portfolio, its history, its credibility, its ownership, its clientele, its projects’ quality, and lastly- which is really important- its after-sales facilities.
With new emerging developers everyday, don’t pick ones with anonymous names or seem dubious, in order to protect your rights and avoid fraud. “Clients should carefully choose the developer, and preferably those with a track record of projects delivered and inhabited,” advises Sales Director of Oriental Urban Development (OUD) Ahmed Zaalouk.
Choosing An Unfeasible Payment Plan
The variety of payment plans is the most trending feature in the real estate market today and this is particularly the deal sealer or breaker. You might like a property so much that you fall into a major debt trap. Be very careful when signing a contract and agreeing to a payment plan that you are bound to commit to for the upcoming five to ten years. This is really serious! It is more often than not that sales agents would give you a brighter picture to make a sale. You need to calculate it correctly and make a wise decision. The picture might seem easy and doable from the outside but can leave you with a trapped financial burden, which you can’t escape. “Some clients choose an inappropriate plan just because of their need to obtain the desired unit, even if it is out of their budget. Then they realize that it has become a financial burden,” Vice President of Coldwell Banker Egypt Mohamed Banany explains.
“If you are going for a long-term payment plan then you must be aware that the installment must not exceed 30% of your monthly income,” advises Development Manager at Aqarmap Ahmed Abdel-Fattah.
Never Visiting The Construction Site
It is very common that homebuyers would buy the off-site units for its appealing design, facilities provided, and views for instance but not the actual unit! Experts believe visiting your under-construction unit is a must. Such visits are necessary to you as a client to make sure that you are getting what you are paying for and to avoid upon-delivery surprises, which may include the wrong view, the wrong size, and/or design defaults. We all know this is a very common feature among construction workers and architects today! Don’t settle for a price and avoid location. Also never ignore your unit and await the company to deliver. You need to keep track of everything and always follow up. Experts advise not to prioritize the price “above any other feature especially location,” says Abdel-Fattah. You must get what you pay for before it is too late and you can’t resell it, he advises.
In terms of design adjustment, seek an expert before you purchase to make sure you are making the right choice. You must consult a decorator, an architect, or interior designer before the unit is delivered, Banany recommends.
Contracts: Too Long To Read
This is maybe the biggest mistake clients do when buying a home. “Contracts are long and we have covered the major parts in it,” some might say but be very careful. There are fine prints that we, as homebuyers, avoid and the sales agents rarely mention them. Such terms need to be well comprehended before you accept the sale…In past years, it is very common that those fine prints have led owners into legal battles with developing companies especially when it comes to payments, delivery penalties, and protecting the clients’ rights. “Never sign a contract without clarifying all your rights and object the terms violating them,” Banany and Abdel-Fattah conclude.
Never Underestimate Your Future Life Expenses
You have made it thus far; buying your dream home, in your preferred location, surrounded by a pool and a garden… But are you up for what you have signed onto years ago? Maintaining a modern unit aside from the above-mentioned features is still costly given the annual compound or neighborhood maintenance and high electricity and water bills, to name a few.
If you have saved for this purchase, you also must have had a pre-plan to how to live up to the standard you put for yourself or it would become a burden too. Abdel-Fattah reckons, “Some clients get shocked after they move in because of the high expenses they were not used to before.” For that, he urges everyone to plan well before buying and embarking on this new life.