Legalization of property in Egypt
Procedures
COMMON PROCEDURE FOR THE PURCHASE OF REAL ESTATE
Foreigners can acquire freehold real estate in Egypt according to the Law 8/1997( Investment Law) :
A registration/legalization process through the court should apply (signature validity court verdict). The investor can resell or rent the property anytime. It usually takes between 6 and 8 months to approve the decision of the court, therefore, the property to be legalized.
The following steps must be taken in order to legalize the property through the court:
a. A purchase contract should be drawn up. The validity of the sale depends on the terms of the contract. So it is essential for the purchaser to have a detailed contract, defining 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, so that Arabic is the only language recognized by the courts.
b. Purchasers must issue a power of attorney to their lawyer so that he can act on their behalf in order to proceed with all works for the legalization. Then the lawyer files a legal suit to obtain a court verdict certifying that the signature on the sale contract truly belongs to the seller (This is the 'signature validity court verdict'). This suit will take between 6-8 months.
It is therefore important to investigate the registration carefully. The lawyer helps to ensure that the property being sold is truly owned by the seller, and after sale, the buyer usually gets the title registered (or otherwise) under his/her name legally.
Property in Sharm El Sheikh cannot be registered.
Property in Sharm El Sheikh follows a different regime, because an administrative decree issued in 2005 abrogated the 1996 law for property in Sharm el Sheikh.
Under the decree, foreign purchasers in Sharm el Sheikh cannot acquire freehold rights, but only 99 year leases. They must therefore follow by imperative the above mentioned procedure ‘signature validity court verdict’, as well as various other steps.
The ‘signature validity court verdict’ method could become the dominant route to establish the foreign purchaser´s rights even outside Sharm, because it allows the foreigner to buy as many properties as he likes, rent and resell them anytime.
The only relevant point is that in Sharm the purchaser will only acquire 99 years leasing rights over the property, while in Hurghada, Sahl Hasheesh etc there will be freehold property.
