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Materials for construction: Corralones emphasize not to lose to the dollar and a budget only lasts 48 hours
December 13, 2023
As a result of the 55% devaluation of the peso, the prices of local products and tools for building and renovating homes are estimated to rise between 35% and 45%.
By José Luis Cieri
Even with rising material prices, private construction activity continues at a good pace
After the first steps of Javier Milei 's era as national president, where a 104% increase in the official dollar was confirmed, triggering a 55% devaluation of the peso, it is expected that the materials to build and renovate homes, which were already experiencing accelerated growth due to current inflation ( accumulating 160.9% year-on-year ), increasing between 35% and 45% these days.
At this point it is diagnosed that a few weeks before the end of the year the values will have exceeded 210% increases, especially in products that are manufactured in Argentina.
The corralones and hardware stores did not stop sales and construction materials made a significant jump between last Friday and today. For example, a 50 kg bag of cement that was worth $5,500 in just 5 days became worth $7,500 per unit and a 30 kg package of porcelain glue that cost $5,400 now skyrocketed to $7,700 per unit.
Due to the devaluation in different corralones they observe generalized increases that average 30 percent. “However, there is still no information available on the adjustments in the prices of steel and iron, products that are quoted in dollars and paid in pesos at the official exchange rate. So far, no changes have been reported and no deliveries are being made. It is relevant to highlight that prices had already been experiencing increases since October, anticipating a possible devaluation and at an accelerated pace. For this reason, the increases announced so far are, for the moment, lower than the increase in devaluation,” Diego Aguirre, CEO of Construyo al Costo, clarified to Infobae.
As for sales, they maintained a good pace, driven in part by private activity, especially in private neighborhoods and developments in the city of Buenos Aires and Greater Buenos Aires.
In addition, people's anticipation of the devaluation of the peso contributed to the increase in sales of construction materials, with considerable demand for stockpiles.
Today a quote is generally valid between 24 and 48 hours. That is the reality of the market. Aguirre expanded: “During this morning the companies that sell materials did not have prices or quotes, and in the afternoon, they only began to report with updates.”
Renovating the home is more expensive. This year there have already been several devaluations and costs in pesos continue to increase month by month
Some of the most in-demand materials are plastics, paints and steel with prices that vary considerably, starting from $500,000 and up.
Aguirre stated that “it is important to highlight that the increases announced today are added to those reported at the beginning of the month. For example, in the faucet sector, the average accumulated increase in the month reaches approximately 45%.”
The recently announced opening of imports is perceived as a limiting factor for price increases in various items, offering a ceiling that is perceived as positive in the market.
Dry construction, also with increases
The hollow brick not only increased, a pallet of 144 pieces measuring 12X18X33 cm that sold for $40,000 is now above 56,000 pesos. Although products to build or renovate dry homes also rose.Guillermo Badano, managing partner of TAO Soluciones Constructivas, explained to Infobae that “in our case it is the manufacture of panels with a wood axis. We use national components and other imported ones at the MEP exchange rate. In the first case they were already rising and now we are waiting for the importers to set updated prices and we are waiting. Although we can estimate that this would impact costs by an estimated 40%.”
Until the previous week there was a great movement to build cabins for tourism and the operations were resolved between investors who are betting on this business and some end users.
Dry construction is also advancing and the prices for doing so have also risen sharply.
“The value of the m2 of paneled homes fluctuated around USD 600 but now we estimate that it will close the year at USD 750, that would be the impact of the devaluation after the impact of post-devaluation prices because openings also rose sharply,” he added. Badano.
The steel frame, which depends on steel or aluminum, until a few days ago was built at a rate of USD 600 on average; Now, that average would be USD 800 per m2.
Tools
The tools and certain machinery necessary for construction also experienced an increase of more than 190% year-on-year until last November and after the devaluation they could close the year with 230 percent.Agustín Giffi , from Empresa Gibeva SA, told Infobae that the sector faces a strong impact from the devaluation. “After months with up to two monthly increases and suppliers speculating with an official dollar between $650 and $700, the recent announcements by the Minister of Economy generated increases of between 15% and 30% in imported tools.”
Tools for working at home could end 2023 with a 230% year-on-year increase
Experts say there are concerns about the sale amid tax pressures for SMEs. Despite a good sales rate, there is fear of not being able to market what is necessary.
“Until yesterday, the best-selling tools were from the gardening and swimming pool sector, such as water pumps, fence cutters, chainsaws, weed removers and generator sets, with tickets ranging between 115,000 and 650,000 per unit,” said Giffi.
Financing through Now 12 or cards in one payment with specific commercial discounts is the common payment method.
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