Egyptian billionaire Naguib Sawiris, chair and chief executive of Ora Developer, has warned that Egypt’s property developers are being pushed into building smaller homes as inflation and rising construction costs undermine what ordinary buyers can afford.

Egyptian billionaire Naguib Sawiris says developers are shrinking home sizes as inflation squeezes Egyptian buyers.He warns that rising construction costs and falling purchasing power are reshaping demand across the market.Prices in Greater Cairo and new cities continue to climb, pushing buyers toward compact units.Developers are relying on flexible designs and long payment plans to keep sales moving.

In a television interview, Sawiris said the sector is now operating under acute financial pressure.

“As one of the major real estate developers in Egypt, we are currently working on decreasing residential unit sizes to ensure affordability for a broad segment of society,” he said.

He argued that the shift reflects a sharp drop in purchasing power. Buyers who once aimed for large apartments are now opting for compact units, not out of changing taste but because repeated price increases have left them with fewer options. He added that buyers are “seeking smaller spaces compared to two or three years ago.”

Property prices in Greater Cairo climbed by roughly 12–18 per cent in the first half of 2025, with even sharper increases in areas such as the New Administrative Capital and New Alamein City.

Building materials, from steel to cement, have surged in cost, and developers have had limited room to absorb the impact. Inflation running above 30 per cent has further eroded household incomes.

Sawiris said developers are also shouldering significant strain. He previously told the American Chamber of Commerce in Egypt that the first phase of his ZED Sheikh Zayed project yielded no profit. “We made zero profit,” he said, citing inflation, currency depreciation and bank lending rates that rose to around 30 per cent.

The move towards smaller units is becoming a sector-wide strategy. Developers are relying on extended payment plans, fixed-price offers and projects built around new transport links to sustain demand. Analysts say these shifts suggest a structural adjustment rather than a short-term response.

Sawiris has repeatedly cautioned against the risk of a property bubble, calling for discipline in pricing and project planning. He has also noted that new infrastructure across Cairo has broadened the areas where buyers perceive long-term value, while the North Coast continues to attract Gulf investors bringing in foreign currency.

The broader question for the industry is whether compact, lower-cost homes will become the new standard. For now, developers appear to be designing for that reality and preparing for it to last.