Despite the downturn, the real estate sector grew by 22 per cent in three years. One reason is the entire mortgage market is only worth about $700 million but sustainment is queried.
Egypt property market safe as houses?
You need only to look out of the window as you fly in over Cairo to get a sense of how closely its 18 million-odd inhabitants are packed together.
Downtown, the city is a crowded, vibrant mess of noise, congestion and pollution. It's no wonder that in recent years many of those who can have started to move into the new "cities" being built in Cairo's suburbs - particularly those districts known as 6th of October and New Cairo.
It's a process that has been encouraged by six years of economic liberalisation that, while hardly affecting the majority of the country's population (15 million of whom still live on less than US$2 a day) has helped create a new strata of nouveau riche.
"Over the past couple of years the private sector has, for the first time in 100 years, eclipsed the public sector as being the primary employer," Maher Rafik Maksoud, the managing director of SODIC, one of the country's biggest property developers, said last year. "There are more people with better incomes, more aspirations and they're now able to realise those aspirations by buying homes."
The economic liberalisation unleashed vast new investments in property, using money that was previously invested outside Egypt. It also helped create a state where it was more acceptable to flaunt your wealth - and buy that big house you'd always dreamed of.
Travel around Cairo's outskirts and you can see the fruits of this new phenomenon: thousands of houses and villas surrounded either by verdant landscaping or stuck, isolated, on scruffy scrub areas of dry desert.
The global financial crisis brought an end to some of the sector's greatest excesses and rises in house prices. Yet, according to the ministry of investment the property sector still grew by 22 per cent over the past three years and is now worth some US$270 billion (Dh991.65bn), says Moustafa el Hayawan, the chairman of the state-run Mortgage Finance Fund.
One reason the sector was not too badly hit was that Egypt's entire mortgage market is only worth about $700 million.
"There was no crisis because there are no mortgages in Egypt, everything is cash so the banking sector is intact," says Ahmed Heikal, the chairman of Citadel Capital. According to a 2008 housing survey, cash purchases represented 57 per cent of all property transactions in Egypt from 2003 to 2008, which means, says Mr Heikal, the "worst that can happen is price stagnation or a small decline in prices".
House prices are supposed to be on the rise, again, due to the country's increased growth, with some of the wilder estimates predicting increases of more than 10 per cent. However, Al-Masry Al-Youm, a local newspaper, cast doubt on this in a recent article where one estate agent was reported as having called this summer "a 'season of lies', referring to the starry-eyed predictions made earlier in the season of an imminent rebound in the real estate market".
The market was also somewhat shaken last summer by some of its more interesting "anomalies" - not least the way developers such as the Talaat Moustafa Group had been able to buy land from the government for its $3bn Madinaty project without having to go through the usual process of taking part in a competitive auction. People sued. The project's legality remained in limbo until last September when, according to Reuters, the government announced it intended to do nothing about the issue except "reallocate the land under a new deal to the company under the same terms - based on its right to act in the national interest".
It's true that every housing bubble has always been sustained by its own internal logic but the question remains: is Egypt's market a bubble? Anyone who has spent time in the city's sprawling new suburbs might think it is but Egyptian analysts point to one strong and constant fundamental driving the market: local demand.
"Egypt's real estate story is all about a strong local demand," says Khalid Khalil, an analyst at Beltone Financial. Mr Maksoud agrees, dismissing claims that what has been taking place in Egypt was speculative investment.
"A lot of the media likes to say real estate in Egypt is speculative, like in Dubai, but this is not true - there is a real demand for something like 450,000 units a year," said Mr Maksoud.
Some official estimates put that figure even higher and say only 60 per cent of the demand is being met. Combine that with annual population growth of 1.5 million a year (although only a fraction will be moving into up-market developments) the pressure and demand for housing in Egypt seems set to continue for a long time to come.