This risk isn’t coming back directly from the banks, however, it’s coming from the gap created within the money market between the demand for mortgages and also the legal offer of it from the banking sector. The qualitative approach helped in understanding the dynamics in the financial market, explaining that the gap created by the strict rules among the banking sector to supply mortgages to the consumers was consummated by the important estate developers with none regulations to confirm the property of the financial sector.
This explains that the real estate sector is exposed to a different risk, coming back from the indirect channel created by the real estate developers to lend the buyers directly. This non-banking variety of disposition is taken into account as poor-quality lending, as a result of it’s not subject to any rules or risk assessments that may make sure the compensation of this credit nor the property of the money system.
Hence, the exposure of the important estate sector to risks would increase, particularly with the recent shocks happening on the Egyptian economy, especially the recent shocks regarding monetary policies. the basic risk lies within the potential impact of the real estate market dynamics on trade cycle fluctuations in Egypt.
Consequently, the high share of the real estate sector of value is additionally at the risk of obstructive not solely the important estate sector growth, however additionally hindering value growth among the Egyptian economy.
In addition, the importance of the real estate sector within the Egyptian securities market and its weight within the stock market are going to be on risk as well, threatening the soundness of the Egyptian stock market’s performance, if the arena is exposed to any shocks.