BuySellBA
Administrator
New mortgage loans: Are home prices going to rise? - Infobae
Source:
Nuevos créditos hipotecarios: ¿van a subir los precios de las viviendas?
El sector muestra signos de incremento en la demanda y surge un interrogante entre los potenciales compradores sobre si es un buen momento para destinar ahorros a propiedades
www.infobae.com
May 3, 2024
The sector shows signs of increasing demand and a question arises among potential buyers about whether it is a good time to allocate savings to properties
The prices of apartments for sale in CABA registered a slight year-on-year increase. They stopped falling and what is expected for what is to come (Illustrative Image Infobae)
Property prices in Argentina are experiencing a slight increase, a trend that began at the end of 2023 and is expected to intensify with the new UVA mortgage credit lines recently launched by three banks. The increases are not expected to be immediate or explosive, but rather gradual, reflecting a recovery and cautious optimism in the market.
The number of operations in the city of Buenos Aires (CABA) already shows significant growth. The total number of real estate purchase and sale deeds increased by 18.3% in March 2024 compared to the previous year. During the last 12 months, the monthly average of transactions was about 3,400.
“However, during the peak period of UVA credits, between 2016 and 2018, monthly transactions reached 6,000. In fact, in just two years, around 110,000 were granted throughout the country, with half of these loans concentrated in a period of high demand, of only 9 months, between the end of 2017 and the beginning of 2018," Alan explained to Infobae. Schachter , architect and consultant specialized in Real Estate.
The average value of these credits during the 2016-2018 period was around $75,000. Schachter added: “Adjusting for inflation, today this amount would be around USD 100,000, a figure that represents the most active range in the current market.”
In the last two months, prior to the announcement of the new mortgage loans, the market had already begun to show signs of greater dynamism. The prices of new apartments increased up to 15% due to the increase in construction costs.
Two and three rooms would be the departments that would generate more operations through mortgage loans
“This trend could continue or increase due to the impetus of this new financial policy,” explained Patricio Bedetti , of Patricio Bedetti Servicios Inmobiliarios.
Forecasts for the end of the year suggest that prices for used units could register an increase of between 10% and 15%, while in new and in-well properties the adjustment would be a little less given that corrections have already been made in the values. “This estimate reflects how the previous update in the new works segment could moderate the impact of the next increases,” Bedetti added.
The possibility of an increase in prices, in the context of an active market, raises concerns about the possible deterrent effect on real estate investment.
A gradual increase in prices – for example, between 1 and 1.5% per month – is not perceived as a factor that could affect the purchase decision. Bedetti maintained: “However, a rapid and marked adjustment could complicate the outlook for the sector again.”
Indicated properties
As for the neighborhoods of CABA, it is anticipated that those of the middle class (such as Almagro or Boedo) and lower middle class (Villa Lugano) will experience greater dynamism thanks to the injection of credits.Schachter added: “The impact of these credits goes beyond the direct purchase of homes. It is estimated that for each one granted, three real estate transactions are generated. “That multiplier effect benefits a broader range of neighborhoods and property types, thus boosting activity across the sector.”
In this context, it is anticipated that the most requested properties will be those that already register a greater demand, such as 1, 2 and 3-bedroom units.
“It is expected that properties with prices below USD 100,000 will benefit the most, reflecting the tendency of buyers to opt for cheaper and better located options,” Bedetti anticipated.
The reintroduction of mortgage credit is seen by the sector as a crucial step towards normalization and alignment with regional trends.
Damián Tabakman, president of the Business Chamber of Urban Developers, said that “it was essential to resume mortgage credit to normalize the sector and align it with what is already a common practice in most countries in the region.”
Mortgage loans in the future could also have a favorable impact on the new home construction sector and could be expanded to housing developers.
On the other hand, construction and development companies highlight the vital importance of these credits.
Hugo Koifman, from Branson Real Estate, pointed out the historical shortage of mortgage loans in the country, recalling that, although interesting options were offered in the 1990s, UVA loans initially attracted attention due to their accessibility. “Credits per se were never established . The UVAs were very attractive at first when the dollar had significant variations, making them economically advantageous. However, it is essential that, as inflation decreases, banks begin to offer loans at a fixed rate,” he assured.
Developers anticipate that the biggest beneficiary of the recent measures will be the used property market, although they also anticipate a positive spillover effect that will drive an increase in the number of sales of well properties.
Furthermore, from the construction sector, there is an expectation that the stimulus policies will be expanded to include credits specifically aimed at developers and a money laundering measure, both considered initiatives that could be realized in the very short term.
www.buysellba.com
Last edited:
