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Egypt's rental market offers some of the most attractive yields in the MENA region, with average returns reaching 6.77% across major cities as of September 2025. Prime neighborhoods like Mohandessin in Cairo deliver exceptional yields of 12-13%, while coastal properties can generate 7-10% through seasonal tourism demand. The Egyptian property market has experienced significant growth, with rental income surging 90.2% in Cairo over the past year, making it an increasingly compelling destination for international investors seeking high-yield opportunities.
If you want to go deeper, you can check our pack of documents related to the real estate market in Egypt, based on reliable facts and data, not opinions or rumors.
Egypt's rental yields average 6.77% nationwide, with prime Cairo neighborhoods reaching 12-13% and coastal areas delivering 7-10% through short-term rentals.
Urban apartments offer the most consistent returns at 6.5-8%, while commercial units and coastal properties provide higher yields of 7-10% but require more active management.
| Property Type | Average Yield | Best Locations |
|---|---|---|
| Urban Apartments | 6.5-8% | Mohandessin, New Cairo |
| Villas | 5-6.5% | Sheikh Zayed, 6th October |
| Commercial Units | 7-9% | New Administrative Capital |
| Coastal Properties | 7-10% | North Coast, Hurghada |
| Studios/Small Units | 8-10% | Tourist areas, Urban centers |
What property types can I invest in Egypt and how do they compare for rental income?
Egypt offers six main property types for rental investment, each with distinct yield characteristics and tenant demands.
Apartments dominate the Egyptian rental market and generate the strongest overall returns at 6.5-8% annually. These properties attract young professionals, expatriates, and middle-class families who value urban convenience and affordability. Two to three-bedroom apartments in prime areas like New Cairo and Mohandessin consistently outperform larger units due to higher demand and faster tenant turnover.
Villas appeal to affluent expatriates and business executives seeking privacy and luxury amenities. These properties typically yield 5-6.5% annually but require higher initial investments and longer vacancy periods between tenants. Villa rentals work best in gated communities in Sheikh Zayed or 6th October City where security and community features justify premium rents.
Commercial units including offices and retail spaces deliver the highest yields at 7-9% annually, particularly in emerging business districts like the New Administrative Capital. These properties require active management and higher maintenance costs but benefit from longer lease terms and stable corporate tenants.
Coastal properties and chalets generate exceptional seasonal returns of 7-10% annually through short-term rentals in destinations like Hurghada, North Coast, and Sharm El Sheikh. Peak summer months can produce monthly income equivalent to 3-4 months of long-term rental rates, though investors must plan for seasonal vacancy periods.
It's something we develop in our Egypt property pack.
Which Egyptian cities and neighborhoods offer the best rental yields right now?
Mohandessin in Cairo stands out as Egypt's highest-yielding neighborhood with exceptional returns of 12-13% for two to three-bedroom apartments as of September 2025.
| City/Area | Average Rental Yield | Property Focus |
|---|---|---|
| Mohandessin (Cairo) | 12-13% | 2-3BR apartments |
| New Cairo | 6.5-10% | Modern compounds |
| Sheikh Zayed/6th October | 6-7.5% | Villas and apartments |
| North Coast | 7-10% | Seasonal chalets |
| Hurghada | 8-10% | Tourist apartments |
| Alexandria | 5-6.5% | Traditional apartments |
| Heliopolis | 4.4-5.4% | Older residential |
New Cairo delivers solid yields of 6.5-10% thanks to modern amenities, international schools, and proximity to business districts. The area attracts expatriate families and young professionals willing to pay premium rents for quality housing and infrastructure.
Sheikh Zayed and 6th October City generate consistent yields of 6-7.5% through strong demand from both residential and commercial tenants. These satellite cities benefit from ongoing development and improved transportation links to central Cairo.
Coastal markets like Hurghada and the North Coast achieve yields of 7-10% primarily through short-term rentals during peak tourism seasons. Hurghada particularly benefits from year-round diving tourism while North Coast properties capitalize on summer domestic tourism.
Alexandria produces more modest yields of 5-6.5% due to limited rental demand relative to property values, while older central neighborhoods like Heliopolis lag at 4.4-5.4% despite prestigious locations.
How does property size affect rental yields in Egypt?
Smaller properties consistently generate higher rental yields per square meter across all Egyptian markets, with studios and one-bedroom units leading performance metrics.
Studios and one-bedroom apartments achieve the highest yields per square meter at 9-10% in Cairo and 8%+ in tourist destinations like Hurghada. These compact units appeal to singles, young couples, and short-term visitors who prioritize location over space. The strong demand from Egypt's growing young professional population keeps vacancy rates low and allows for frequent rent increases.
Two to three-bedroom apartments deliver balanced yields of 7-8% while maintaining broad tenant appeal. These mid-size units attract families, roommate groups, and expatriates seeking comfortable urban living without excessive costs. Property managers find these units easier to rent and maintain compared to larger alternatives.
Large apartments and villas with four or more bedrooms typically yield 4-6% due to limited tenant pools and higher vacancy rates. While these properties often appreciate faster than smaller units, their rental performance suffers from seasonal demand fluctuations and longer marketing periods between tenants.
Smaller units also excel in short-term rental markets where tourists and business travelers prefer affordable, well-located accommodations over spacious but expensive alternatives. This size advantage becomes particularly pronounced in tourist areas where nightly rates favor compact, efficiently designed spaces.
What are current property purchase prices including all costs and fees?
Egyptian property prices vary significantly by location and type, with total acquisition costs typically adding 6-9% to base purchase prices through various fees and taxes.
| Property Type/Location | Price Range (USD) | Additional Costs |
|---|---|---|
| Cairo Studio | $82,000 | 6-9% total fees |
| Cairo 4+BR Apartment | $210,000 | 6-9% total fees |
| Alexandria 2BR | $67,000 | 6-9% total fees |
| Alexandria 4BR | $174,000 | 6-9% total fees |
| Hurghada Studio | $54,000 | 6-9% total fees |
| Hurghada 2BR | $100,000 | 6-9% total fees |
| Luxury Coastal Villa | $250,000-$1M+ | 6-9% total fees |
Registration fees add 1-3% of property value while real estate agent and legal fees contribute another 2-3%. The government charges a 2.5% transfer tax plus notary and administrative fees ranging from $500-2000 depending on property value.
Annual property taxes equal approximately 10% of rental value after standard deductions, though properties generating less than EGP 24,000 annually in rental income qualify for tax exemption. This tax structure particularly benefits smaller investment properties and those in emerging markets.
New Cairo and premium developments command higher prices but offer modern amenities and infrastructure that justify premium valuations. Coastal properties in Hurghada provide entry-level investment opportunities while luxury North Coast developments can exceed $1 million for premium beachfront locations.
How do financing options impact my rental returns in Egypt?
Egypt's financing landscape presents significant challenges for property investors, with commercial mortgage rates of 25-26% making traditional financing uneconomical for rental investments.
Market mortgage rates currently range from 25-26% annually, which completely eliminates positive cash flow for most rental properties. At these rates, mortgage payments typically exceed potential rental income by 200-300%, making leveraged investments financially impossible under standard banking terms.
Government-subsidized mortgage programs offer much more attractive rates of 3-8% for qualifying buyers through Central Bank of Egypt initiatives. These programs provide 3% rates for properties valued up to EGP 1.1 million and 8% rates for properties up to EGP 2.5 million, with repayment terms extending up to 30 years.
Most successful Egyptian property investors purchase properties outright or use short-term bridge financing to avoid prohibitive interest costs. Cash purchases allow investors to capture full rental yields without interest expenses, while short-term loans help bridge timing gaps between property sales and purchases.
Investors qualifying for subsidized programs can achieve positive leverage, where mortgage costs remain below rental yields. A property generating 8% annual rental yield financed at 3% creates 5% positive leverage that amplifies overall returns on invested capital.
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What rental income can I expect from different property types?
Rental income varies dramatically between long-term and short-term rental strategies, with seasonal and location factors significantly impacting monthly cash flows.
| Property Type | Long-term Monthly Income | Short-term Monthly Income |
|---|---|---|
| Cairo Apartment | $692-$1,224 | $800-$2,000 |
| Villa/Townhouse | $2,500-$5,000+ | $3,000-$8,000 |
| Studio/Loft | $357-$700 | $600-$1,100+ |
| Coastal Chalet | $2,000+ (seasonal) | $5,000+ (peak season) |
Cairo apartments generate steady long-term rental income of $692-$1,224 monthly depending on size and location. Prime neighborhoods like Mohandessin and New Cairo command the highest rents while older areas produce more modest income streams.
Short-term rentals in prime Cairo locations can produce $800-$2,000 monthly during peak periods, though this requires active management and marketing to maintain high occupancy rates. Tourist areas and business districts perform best for short-term strategies.
Villas and townhouses target high-income tenants willing to pay $2,500-$5,000+ monthly for privacy and luxury amenities. Short-term luxury villa rentals, particularly in coastal areas, can generate $3,000-$8,000 monthly during peak seasons.
Coastal chalets represent the highest-income potential with luxury properties earning $5,000+ monthly during peak summer season. However, these properties often sit vacant during off-peak months, requiring careful cash flow planning and marketing strategies to maximize annual returns.
What types of tenants rent properties in Egypt and how should this affect my strategy?
Egyptian rental markets serve distinct tenant segments with specific preferences, budgets, and lease requirements that directly impact investment strategies and property management approaches.
Urban apartments primarily attract young professionals, expatriates, students, and middle-class families seeking convenient access to employment centers and amenities. These tenants typically prefer furnished or semi-furnished units with reliable internet, parking, and security features. Lease terms usually range from 6-12 months with potential for renewal.
Villa tenants consist of affluent expatriates, diplomats, business executives, and wealthy Egyptian families prioritizing privacy, space, and prestige locations. These high-income tenants often sign longer lease agreements of 1-3 years and expect premium amenities including housekeeping services, landscaping, and 24-hour security.
Coastal and short-term rental properties serve tourists (both foreign and domestic), digital nomads, and families on holiday. These tenants value location, cleanliness, and modern amenities over long-term lease stability. Peak season demand comes from European tourists escaping winter and Egyptian families during summer holidays.
Student housing near universities creates consistent demand for affordable shared accommodations and studio apartments. These tenants typically require furnished units with flexible lease terms aligned with academic calendars.
Successful rental strategies must align property features, pricing, and marketing with target tenant expectations. High-end properties require white-glove management while budget rentals focus on competitive pricing and quick turnover capabilities.
What are typical vacancy rates and how do they impact returns?
Vacancy rates in Egypt vary significantly by property type and location, with prime urban areas achieving 85-90% occupancy while less central locations can drop to 70-75%.
Prime urban areas including New Cairo and the New Administrative Capital maintain high occupancy rates of 85-90% for well-located apartments throughout the year. These areas benefit from consistent demand from professionals, expatriates, and families seeking quality housing near employment centers.
Coastal properties experience dramatic seasonal fluctuations with peak occupancy exceeding 80% during summer months but dropping significantly during off-season periods. Successful coastal investors plan for 3-4 months of reduced occupancy annually and budget accordingly for maintenance and marketing during quiet periods.
Short-term rental markets in Cairo show more challenging occupancy metrics with median rates around 34% for typical properties. Bottom quartile performers achieve much lower occupancy, highlighting the importance of professional management, strategic pricing, and superior property presentation for Airbnb-style rentals.
Luxury properties and large villas typically experience higher vacancy rates due to limited tenant pools and longer marketing periods between leases. These properties may sit vacant for 2-4 months annually, requiring higher gross yields to achieve acceptable net returns.
Effective vacancy management requires competitive pricing, responsive maintenance, and proactive tenant retention strategies. Properties in secondary locations must offer exceptional value to compete with prime area alternatives.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Egypt versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
How do gross and net rental yields compare across property types?
Gross rental yields in Egypt average 6.77% nationally, but net yields typically fall 1.5-2% lower after accounting for taxes, fees, vacancy periods, and property management costs.
Cairo apartment investments achieve gross yields of 6.77% on average, with prime neighborhoods like Mohandessin reaching exceptional gross yields of 12-13%. However, net yields typically settle at 4.5-5.5% after deducting property taxes (10% of rental value), management fees, maintenance costs, and vacancy allowances.
Commercial units maintain higher net yields despite management complexity because stable corporate tenants often sign longer lease terms and handle their own maintenance responsibilities. Net yields for well-located commercial properties typically remain 1-2% higher than comparable residential investments.
Coastal properties present wide yield variations depending on management efficiency and seasonal optimization. Properties with professional short-term rental management can maintain net yields close to gross yields during peak seasons, while poorly managed properties may see net yields fall 3-4% below gross yields due to high vacancy and turnover costs.
Luxury villas and large properties typically show the largest gap between gross and net yields due to higher maintenance costs, property management fees, and extended vacancy periods between high-quality tenants.
Investors should budget for net yields approximately 70-80% of gross yields when evaluating Egyptian property investments, with higher-end properties requiring larger discounts for management complexity.
How have rental yields changed over the past year and five years?
Egypt's rental market has experienced dramatic growth over the past year, with rental prices in Cairo surging 90.2% in 2024-2025 while property appreciation has driven yield improvements across most market segments.
Over the past 12 months, property prices have increased 20-30% nationwide while rental income has grown even faster at 90.2% in Cairo specifically. This rental growth has outpaced property price appreciation, leading to improved gross yields for existing property owners and creating attractive entry points for new investors.
The five-year trend shows consistent market expansion driven by population growth, new city development, and increased foreign investment. Average rental yields have risen from 5.5% in Q1 2024 to 6.77% in Q2 2025, outperforming inflation and competing favorably with other MENA market alternatives.
Post-2020 market dynamics have been particularly favorable as economic reforms, infrastructure development, and the New Administrative Capital project have created substantial new rental demand. Urban areas have benefited from ongoing migration from rural areas and increased expatriate presence in business districts.
Short-term rental markets have shown more volatility, particularly in tourism-dependent coastal areas that experienced significant disruption during 2020-2022 but have since recovered to exceed pre-pandemic performance levels.
Currency devaluation has created opportunities for foreign investors while domestic demand has remained strong due to limited alternative investment options and persistent housing demand in major urban centers.
What are the rental yield forecasts for Egypt over the next 1, 5, and 10 years?
Egyptian rental yield forecasts remain optimistic across all time horizons, with stable to increasing yields expected as infrastructure development and population growth continue driving rental demand.
One-year forecasts predict stable yields of 6-8% in established urban and coastal markets, with potential for slight increases in emerging areas like the New Administrative Capital. Ongoing infrastructure projects and continued expatriate influx should support consistent rental demand through 2026.
Five-year projections show significant appreciation potential for prime areas including the New Administrative Capital, North Coast developments, and Sheikh Zayed expansion zones. Properties in these areas could appreciate 20-50% while maintaining stable yields of 6-8% as rental demand grows alongside property values.
Ten-year outlook depends heavily on political stability, continued economic reforms, and infrastructure investment programs. Assuming stable conditions, yields are expected to remain in the 5-7% range as Egypt's real estate market matures and aligns more closely with international standards.
The New Administrative Capital represents the highest growth potential over all time periods as government relocation drives massive demand for both residential and commercial properties. Early investors in strategic locations may see exceptional returns as the city reaches full operational capacity.
Coastal tourism markets should benefit from ongoing Red Sea development projects and improved transportation infrastructure, supporting sustained demand for short-term rental properties over the next decade.
It's something we develop in our Egypt property pack.
How do Egypt's rental yields compare with other international markets?
Egypt's average rental yield of 6.77% positions the country competitively within the global real estate investment landscape, particularly when compared to other emerging and established markets.
| Country/City | Average Rental Yield | Market Characteristics |
|---|---|---|
| Egypt (Cairo) | 6.77% | Prime areas >9%, coastal STR 7-10% |
| UAE (Dubai) | 6.8-8.5% | Strong luxury/tourist sector |
| Turkey | 5.5-7.2% | Higher risk, similar urban yields |
| Greece | 4.5-6% | Lower overall, some tourist highs |
| Spain | 5.2-7.4% | Established urban rental markets |
Egypt's yields compete directly with Dubai's established luxury market while offering lower entry costs and potentially higher appreciation upside. The 6.77% average yield exceeds most European markets including Spain, Greece, and Portugal where yields typically range from 4.5-7.4%.
Compared to regional MENA competitors, Egypt offers similar or superior yields to Turkey's 5.5-7.2% range while presenting a more stable political environment and established legal framework for foreign property ownership.
Egypt's prime market segments, particularly Mohandessin's 12-13% yields and coastal short-term rentals at 7-10%, significantly outperform most international alternatives. These exceptional yields reflect Egypt's emerging market status and the significant rental demand growth occurring in key urban centers.
When adjusted for entry costs and appreciation potential, Egypt offers compelling value compared to more expensive markets like London (2-4% yields) or New York (3-5% yields) where high property prices compress rental returns despite strong rental demand.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Egypt's rental market offers exceptional opportunities for informed investors willing to focus on prime locations and professional property management.
The combination of strong yield potential, growing rental demand, and competitive regional positioning makes Egypt an attractive addition to diversified international property portfolios in 2025.
Sources
- Egypt Real Estate Market Outlook
- Property Types in Egypt Defined
- Global Property Guide - Egypt Rental Yields
- Cairo Property Investment Guide
- Egypt Real Estate Forecast
- Alexandria Property Market
- Egypt North Coast Investment Analysis
- Property Taxes and Fees in Egypt 2025
- Egyptian Housing Price Surge 2025
- Complete Guide to Property Taxes in Egypt