Payment plans in Hurghada: how to do the maths before you say yes

The payment plan is the reason most foreign buyers consider an off-plan property at all. Ten or twenty per cent down, the rest spread over years, often interest-free — on paper it is hard to say no.

This article is about looking at that same offer with a calculator.

A payment plan is not a discount, it is a structure

The typical structure in Hurghada and in Egypt: 5–15 per cent down, then monthly or quarterly instalments over five to ten years. Some developers let you keep paying after handover, usually for another two to three years.

The developer is not offering this out of kindness. From their side a payment plan is financing: they build with your money. There is nothing wrong with that in itself — but it does mean the price and the terms are negotiable, and that it is worth doing the arithmetic.

How to compare two offers honestly

Most buyers look at two numbers: the down payment and the monthly instalment. Those are exactly the two numbers that tell you the least.

The full price of an offer is this:

down payment + all the instalments added together + the lump sum due at handover + the compulsory fees.

Add those four items up for both offers, and only then compare them. It happens regularly that the offer with the lower down payment ends up being the more expensive one.

What interest-free actually means

Genuinely interest-free plans do exist: there are developers working with ten per cent down and terms of up to ten years, with no interest.

But interest-free does not mean it costs the same as paying cash. Ask the question: what is the cash price for this same apartment? The difference between the two numbers is the real price of the payment plan. It may well be worth it — but at least you will know what you are paying for the delay.

What arrives at handover, and what few people budget for

Handover does not end with the last instalment. In Egypt there is typically a separate maintenance deposit, in the order of eight per cent of the price, and the payment tied to delivery itself can reach ten per cent.

On top of that come the utility connections, the interior finishing and the furniture, and then the annual service charge. The official Egyptian property platform is blunt about it: budget another ten to fifteen per cent above the list price.

If you have committed every last unit of your budget to the instalments, handover is exactly where you will run short — at the point where the flat is yours but not yet liveable.

What happens if the developer is late

There are rules here, and they are worth knowing. The developer is given a twelve-month grace period on a late handover. If the delay runs a further twelve months beyond that, the buyer may stop paying the instalments. If the delay exceeds twenty-four months, the buyer is entitled to terminate the contract and get their money back.

Look for these points in your contract. If they are not in it, ask why.

What happens if you are late

Contracts normally carry a late-payment penalty, and it adds up fast: even a delay of a few weeks can turn into a serious amount.

Ask in advance how many days of grace you have, how big the penalty is, and whether there is a point at which the developer can terminate the contract. And above all: if they do terminate, what happens to the money you have already paid. That is the most important sentence in the whole contract, and it is usually not on the first page.

Five questions to ask before you sign

What is the total sum, including every compulsory fee?
What is the cash price for the same apartment?
How large is the lump sum due at handover?
What are the consequences of a delay — on my side and on the developer side?
Which projects has this developer already delivered, and can I go and see one?

If you do not get a clear, written answer to any of them, that is an answer in itself.

If you would like a second pair of eyes

You can see our payment-plan properties here. If you have picked one out, whether from us or from anyone else, write to us: we will add up the four items together and tell you what we see in the offer.

We wrote separately about checking the paperwork: what to check before you pay.