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registration of properties |
As per Law No. 230 of 1996, if the buyer registered the property, he can not sell it or rent it for five years. The buyer must bring into Egypt the purchase amount in foreign change, through one of the public commercial banks (though this provision of the law is not enforced). Due to recent changes, the registration fee is now less expensive than before, but its process is still taking time to be completed.
ADVANTAGES: This method guarantees full and maximum protection. The Egyptian law recognizes it for transferring real estate ownership.
DISADVANTAGES: The owner is not entitled to resell or rent the property until 5 years are passed from the date of the purchase. After 5 years, the owner will need to obtain a written approval from the Prime Minister to sell the property.
'Signature Validity Court Verdict' Ownership
This method has been setup to use in Sharm El Sheikh, where foreign buyers can only acquire 99 years leases. The reason is that an administrative decree abrogated the Law No. 230 of 1996 in 2005.
However, the 'signature validity court verdict' method could become the privileged route for foreigners even outside Sharm, because it allows the foreigners to buy as many properties as they like. rent them, and sell without restrictions.
This method requires the following steps:
1. The buyer must obtain from the government a 'negative' certificate for the property, stating that there are no mortgages, pledges, or any other sort of rights on the property registered to any other party.
2. The tax authorities to state which taxes are due on the property must issue a certificate.
3. The validity of the sale depends on the terms of the contract. Therefore, the buyer should have a detailed contract, specifying the property boundaries, the purchase price, the method of the acquisition of the rights of the previous owner, and the method of payment. The contract must be in Arabic, because the courts only recognize Arabic.
4. The buyers must issue a power of attorney to their lawyer who can act on their behalf: this procedure firstly requires that the buyer obtains a multi-entry visa. Then the lawyer has to proceed to obtain a court verdict certifying that the signature on the contract truly belongs to the seller (This is the 'signature validity court verdict'). This process can even take 6 to 8 months.
ADVANTAGES: This method is a practical way for real estate transactions either in Sharm El Sheikh, Hurghada, or Marsa Alam or elsewhere. It allows the buyer to resell his property whenever he likes without need of any approval.
DISADVANTAGES: This method guarantees less protection than the registration. Until now many Egyptian owners didn't register their properties for different reasons: in the past, the registration fee had high cost; some of the owners still have pending debts and are worried that the creditor will claim their property after registration.
The best way for any person who would like to buy property in Egypt is to hire a professional lawyer as he will help in all the necessary steps. Almost of the Real Estate Agencies and Developers are able to advise their clients in the choice of the right lawyer.
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