The Ministry of Housing, Utilities, and Urban Communities has increased the price per square meter in the cities included in the third phase of the Dar Misr project as a result of the flotation of the Egyptian Pound and the increasing prices of building material, Al Borsa reported on Tuesday.

The move is reportedly putting such units in direct competition with those provided by private developers. The increase in prices was applied on units under construction, including 10,600 units offered in the supplementary phase of the project, while prices for units in the third phase of the project are currently being reviewed.

The New Urban Communities Authority has reportedly met with contracting companies to agree on the new official increase in price per meter square in the current phase of Dar Misr. The price per meter square in the Koronfel area located in New Cairo has been increased to EGP 4,920, instead of EGP 4,250.

The Housing Ministry had previously targeted a low profit margin of EGP 5 bn from the total investment cost of EGP 70 bn that were allocated to build 250,000 units, unnamed sources at the housing ministry told Al Borsa.

Even though the ministry will increase prices, the units are nonetheless expected to continue witnessing high demand compared to private developments which largely provide upscale units, according to Ahmed Anis, Professor of Civil Engineering in Cairo University.

Dar Misr was announced two years ago amid the Housing Ministry’s efforts to limit the increase in prices in the real estate sector, offering housing units at approximately 30% lower prices than the private sector.