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Mortgage loans: What remodeling can be done with the amounts of the new loans offered by banks - La Nacion Propiedades
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Créditos hipotecarios: qué remodelaciones se pueden hacer con los montos de los nuevos préstamos que ofrecen los bancos
El baño y la cocina son los ambientes que más cambios suelen tener a lo largo de su vida; cuáles son los detalles de los créditos hipotecarios que ofrecen los bancos para mejoras, remodelaciones, terminación o ampliación
www.lanacion.com.ar
May 16, 2024
The bathroom and kitchen are the environments that usually undergo the most changes throughout their life; What are the details of the mortgage loans that banks offer for improvements, remodeling, completion or expansion
By Nicolas Bal
Mortgage loans arrive not only to buy a house but also to rejuvenate the different environments of a property
The new lines of credit that more than 10 banks have already launched allow a range of possibilities to be deployed to rejuvenate the different environments of a property. And, after a long time, it marks a turning point for those interested in carrying out remodeling, completion or expansion works - in many cases, long truncated -.
Thus, with a construction cost that in March was in the order of US$1,318.8 per square meter for multifamily homes , according to Real Estate Report statistics , in the midst of a scenario of strong increases in local currency (the construction cost increased by 198% from April 2023 to April 2024), with devaluation of the official and a “sleepy” blue , prices in dollars - which increased year-on-year by 35.77% - to carry out the remodeling The bathroom and kitchen - the most common on the market - were appreciated again.
Consequently, venturing to budget for new works became an intricate task and an arduous challenge for industry professionals, forced to make decisions that were once unusual.
In fact, some jobs are being re-quoted upon payment . “Although they could be updated by CAC when the contract with the client is closed, the only way to have a real budget is to quote the day the client pays and then negotiate how the balance will be updated,” explains Ana Astudillo, owner of the study. eponymous, director of Women in Real Estate (MRE) and design manager at Brody Friedman.
Remodeling the kitchen fluctuates between US$20,000 and US$50,000
Another current modality is to provide quotes with a maximum validity of seven days, or even less . A few months ago, when prices changed exponentially every week, “there were unions that delivered them for a duration of just three days,” confesses architect Tamara Stupnik, partner at Estudio Gubbay. And, if approved, “the total amount of materials was requested as an advance so as not to run the risk of them increasing.” And there were times when they even requested “adjustments to the budgets of works already started.”
Essential environments: how much does it cost to renovate the bathroom and kitchen
Although historically a remodeling could be estimated with a value per average square meter based on the finishing materials that had to be used and the costs according to the sector involved that was intended to be valued, momentarily this became almost a utopia. It is impossible to generalize costs without separating room by room and you have to be very precise, since there are many price variations.
When it comes to renovating a bathroom, the value per m2 of remodeling a bathroom, in turn, ranges close to US$1,100
In this way, with a standard cost of $10 million (about US$9,868 according to the blue price) to remodel the bathroom and kitchen, according to a recent Real Estate Report report, specifically a mid-range kitchen starts at a value of US $ 700/m², which is divided between 60% of the costs of materials and 40% of labor, approximately, when long ago this equation was 50% and 50%. With the furniture included and with varied prices, “ remodeling this fundamental room of the house fluctuates between US$20,000 and US$50,000 , depending on the quality of countertop materials, furniture, the type of taps, etc.”, he specifies. Astudillo.
Calculator in hand, the value per m² of remodeling a bathroom, in turn, ranges close to US$1,100 . And here a clarification is warranted: in this case, it is a little higher in relation to the kitchen due to the component of pipes and faucets that, currently, have seen a significant increase in their prices. Of course, it depends on who is on the other side because “ceramics vary between $5,000 and $50,000 ,” says the partner of Estudio Gubbay.
The cost of remodeling other spaces in the house
Changes in habits are involved, especially driven by the pandemic, today there are other environments that have taken on a previously rare relevance: there are the living room and even the laundry room - which can also be smaller or disappear to make room to the kitchen−, also becoming home office spaces that are in high demand to refunctionalize a home.Depending on the floor, “users are looking for a meeting place and, for this, in certain cases, some are willing to sacrifice a bedroom ,” reveals Astudillo. With the dynamism of today's routine, houses must adapt. And if this “is accompanied by a scenario that favors credit, even better.”
But there is a B side: others focus “on redecorating outdoor spaces or renovating to have one more room, knocking down a wall and shrinking a common space, such as the living room or dining room,” reports Stupnik. In that sense, “you have to build another wall, put in a door, change flooring, do electricity and paint; for which you have to think about investing about US$5000."
Now, if the restructuring is just a tune-up - that is: painting, electrical installation in the case of older properties and eventual laminated floor polishing - the amount could be around US$550 . Although it is more comprehensive and includes changes in the environment, masonry, “it will resemble the m2 of new construction: around US$1,100 per m2,” concludes the director of Women in Real Estate (MRE).
Painting, polishing and laminating floors and other repairs are possible with the new mortgage loans
New mortgage loans: the requirements to finish, renovate or expand a house
The Mortgage Bank grants a loan of up to $125 million in a single disbursement intended for completion - in which case they finance up to 50% - or expansion - with 100% financing - of a first or second home. It has a rate of 8.5%. The first 12 installments for clients with bank credit have a rate of 4.25%, which means a 50% promotion in the first year (with the total financial cost: final rate of 8.65%; 4.4% final the first year for salary accounts). The maximum payment term is 360 months (30 years), with a capital adjustable by UVA and a monthly payment to be paid cannot exceed 25% of the applicant's income .For the same purpose, Banco Ciudad offers a line of credit to renovate, improve or expand a first or second home in all areas of influence of Banco Ciudad (AMBA, provinces of Córdoba, Mendoza, Tucumán and Salta) for those who already collect or migrate the accreditation of their salary to this entity. The maximum loan amount is $250 million and the general line has an interest rate of 5.5%, with an adjustable capital per UVA; terms for 10, 15 and up to 20 years, and a fee that must not exceed 25% of the income of the applicant and/or their family group.
Banco Supervielle requires that the applicant have a minimum income of $450,000 for expansion, renovation or improvement , being able to pool salaries with their spouses, cohabitants or parents. This credit has no limit on the amount and the capital is adjustable by UVAs. The rate for those who have a salary account in the bank is 4% for the first 12 months and then 5%. For their part, for clients who do not prove their salaries and for non-clients, the rate will be 8% . The maximum term will be 30 years and the credit installment may not exceed 25% of the verified net income.
In the case of Banco Galicia , it offers loans with no maximum amount; The capital to be requested is adjusted by UVA and has an interest rate of 5.5% for those who credit their salaries in the bank and 7.5% for those who do not receive their salary there. The term for renovation or expansion is 10 years and up to 50% of the construction budget is financed . The amount of the fee to be paid cannot exceed 25% of the applicant's income.
The ICBC offers a maximum amount of $250,000,000, with a payment method in UVA and a rate of 5% for those who have a salary account with the entity and 7.5% for the rest of the applicants. The ratio of the fee to the applicant's income is 25%. The term to request the loan is up to 15 years and up to 75% of the total cost is financed. The credit is intended for renovation and expansion.
The largest financial entity in the country, Banco Nación, offers a maximum amount of $105,000 UVAs (about US$90,000 -at the value of the MEP- or approximately $90,000,000 ) with a rate of 4.5% for the bank's clients. Financing is up to 75% of the cost. The payment method is in UVAs with a term of between 5 and 30 years. The credit is intended for the construction, renovation and expansion of homes throughout the country as well as for the acquisition of a second home. The maximum age to request it must not exceed 85 years at the end of the payment schedule. And the relationship of the fee with the applicant's income must not exceed 25%.
Among the banks in the interior of the country that joined in offering lines of credit, Bancor (Córdoba) finances 100% of the construction, expansion or completion. Per applicant (who are clients of the bank) a maximum of $90,000,000 or 100,000 UVAs is granted to date and the term for financing is between 5 and 20 years with a rate of 4.90% throughout the term. The maximum fee/revenue ratio percentage is 25%.
The Banco Provincia del Neuquén also allocates its credit for expanding a first home with two lines: the first will be up to $50 million , which must be accessed with income of $890,000 and an initial payment of $300,000 will be paid. The second line will be up to $100 million . To access that amount, you must have income of $2,700,000 and an initial fee of $940,000 will be paid. For the first line, the rate will be 3.5% for bank clients with a product package and 4.5% for the rest of the cases. In the second line, the rate will be 8.5% for bank customers with a product package and 9.5% for non-customers. Payment is through the UVA methodology. 100% financing may be granted for construction or expansion within a period of 20 years and the fee may not exceed 35% of net income.
In addition, this bank has other financing for home expansion, renovation and completion through the personal loan modality, with a term of up to 72 months and a maximum amount of $15 million. The interest rates will be 50% for those who have accreditation of earnings in the BPN and 60% for those who do not.
In the case of Banco de Corrientes, the credit they grant is intended to finance the construction, acquisition, expansion and renovation of a single or second home, family destination or permanent occupation. All natural persons who receive their earnings through crediting to accounts enabled at the bank can access it. The term for expansion and renovation is 120 months (10 years) and up to 80% of the project value is financed . It is adjustable by UVA with a fixed rate of 5% .
Finally, after several days of a more than distinguished “mobilization” of the real estate sector, there are now 13 entities that offer mortgage loans in Argentina.
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