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Properties: money laundering is exciting for developers who are asking for loans to buy apartments under construction - La Nacion Propiedades
Source:
www.lanacion.com.ar
June 19, 2024
Carla Quiroga
Developers are requesting the creation of mortgage loans to buy apartments under construction or newly built that cannot yet be registeredSantiago Filipuzzi - THE NATION
The dizzying announcements of mortgage loans launched in recent months have sparked a sign of hope for their power to reactivate demand in a real estate market that for months has promised a change of cycle and rising prices. However, those who build the projects celebrate the initiative at the same time that they have begun to publicly request that the entities include in their portfolios lines applicable to the purchase of apartments in a short period of time.
“ We welcome the provision of credit tools to access housing, but developments should definitely be included in these programs. The possibilities of articulating solutions are much greater when construction is in progress: there is more supply of typologies, more locations, much more flexibility and facilities and, in addition, it contributes to the economic cycle because private work generates movement and is linked to all industries and the world of work ,” explained Marcos Juejati, partner and founder of the developer NorthBaires , which is currently developing 150,000 square meters in the city of Buenos Aires. The company that develops the OM projects works with the premium segment with a sale value of its projects that ranges between US$3,000 and US$7,000 per square meter, in its complexes located in the most select areas of the city.
“ The credits changed the mood and improved the expectations of the sector, it also generated a little oxygen for the developers who come with very high costs and with a dollar that was still until a few weeks ago and a feeling of strangulation between costs and prices,” Carlos elaborates. Spina, commercial director of Argencons , the developer with more than 300,000 meters under construction: its latest launch Quartier Bajo Belgrano with units that average US$3,500/m² .
Developers hope there will be credits for apartments that cannot be deeded
Santiago Tarasido, CEO of the construction company Criba, recognizes that although “Argentines are accustomed to operating in crisis contexts,” there is a more fundamental issue, which is that the deficit in housing solutions in Argentina exceeds 3.5 million and with The square meters that are built each year cannot cover the population growth. And on the other hand, the focus is on the AAA market for the simple reason that it is built for those who can pay “almost in cash.”
In this context, the businessman acknowledges that “the arrival of mortgage credit gives the possibility of expanding the offer to other segments. The challenge is how to quickly impact new developments and not just the stock.”
It also puts on the table that for the market to approach more structurally normal conditions, other things are needed in addition to mortgage credit: “ greater openness to the world in materials, services and technology; intermediate credit for developers ; modify the enormous disincentive to hire personnel and to create new companies - in construction the number of employers was reduced 25% in the last 15 years from 26,000 to 20,000; creation of regulatory frameworks that generate more aligned public-private incentives – such as the housing law promoted in Uruguay and reduce costs by generating more competition and productivity throughout the construction value chain.
Along the same lines, Damián Tabakman, president of the Business Chamber of Urban Developers (CEDU), recognizes that the credit will generate a demand from people who otherwise would not be able to buy a property , but he recognizes that the developers were left out.
This means that the supply of housing (houses or apartments) or construction on lots that do not yet have title deeds is also available and suitable for being acquired with credit. The key fact is that the same conditions apply as the rest, with the developer being the one who guarantees each operation until the time of title deeds.
Under Bancor's conditions, per applicant (bank clients) a maximum of $90 million is granted, which can be financed over up to 20 years. The capital is adjustable by UVAs with a rate of 4.90% throughout the term.
The initial loan is $17 million (20,000 Uvas), with a payment of around $115,000 and with a required income of $470,000 for the entire family group. Not only can the loan be taken into account for a couple, but also for the parents of both; the line is also for singles. For the maximum amount, the payment is $554,000 and an income of $2,250,000 must be collected. That is, for every $10 million, the payment today is $66,150 pesos. “In this case, the developer is asked to guarantee that the project will be completed on time and in the correct manner, a requirement that limits this possibility to large developers with larger balance sheets,” analyzes Tabakman and highlights the case of Vizora with Remeros Beach where the Macro bank -the same business group as the developer- gives long-term loans to buy in a pit . “It is difficult to extrapolate this experience to other cases,” he acknowledges.
“ The arrival of credit is excellent news for the market, but it is essential to enable credit lines that can be used to buy units in the developments that have already begun, always respecting the characteristics and guarantees that a type of commitment like this requires,” says Daniel Eirín, commercial manager of Saltum, the company that installed the concept of accessible premium developments with its WH complex in the Coghlan neighborhood.
The developer adds that “banks have the opportunity to securitize the developers’ works, and achieve a virtuous circle between the developer, the individual and the bank , which would allow many works to start and the banks to work as seed capital with a large brick-and-mortar backup in which everyone wins.” Saltum is moving forward with a luxury complex where the old Argentina Sono Film studios used to operate, in Bajo Belgrano, where the square meter is priced at approximately US$6,000.
The developer also highlights the dynamics of the Paraguayan real estate market where this week he presented his fourth project: 01 Vila Asunción will be built in the Ykua Sati area of the Paraguayan capital, in the San Jorge neighborhood, close to two main roads, Madame Lynch and Santa Teresa. This is Vitrium Capital's fourth project in that country where it landed in 2020, in the Mburucuyá neighborhood, with an investment of US$10 million and two towers.
“ Paraguay is a country that offers significant competitive advantages for real estate investment . “Currency stability, favorable investment policies and low tax burden are variables that add up to real coherence in public policies across different government administrations, creating a predictable and safe environment for long-term investments,” analyzes Gagliardo, who clarifies that it also has a middle class that has grown significantly. “A substantial fact for us since we develop products intended mainly for this segment,” he adds.
Today only the Banco de Córdoba allows you to buy with well creditBannafarsai_Stock - Shutterstock
At this point, developers recognize that there are tools that could be incorporated into the market, such as the future asset mortgage, highly developed in Peru. “ We would like to import it, but that requires a legislative change in Congress that is not available,” analyzes Tabakman and explains that another possibility is for the banks to finance the real estate developer to do the work and when it is finished, grant credit to each buyer. .
Looking ahead, Spina expects progress in the money laundering process for the purchase of properties in the development phase . He proposes using the same requirements as the previous one: units in projects with less than 50% progress.
Regarding sales prices, they say they will increase . “Because the cost of construction will not go down and when the available stock is placed, what comes out on the market will come out at a higher price,” analyzes Gagliardo, although he clarifies that the process of economic adjustment will take time. “ Credit is a good start , it helps, but lowering inflation is key. When it is close to 20%, 25% annually there will be greater demand, but when it is less than 10%, it will explode.
www.buysellba.com
Source:
Propiedades: el blanqueo ilusiona a los desarrolladores que piden créditos para comprar departamentos en construcción
Los créditos hipotecarios prometen dinamizar al sector mientras las empresas desarrolladoras reclaman líneas para comprar en pozo
www.lanacion.com.ar
June 19, 2024
Carla Quiroga
Developers are requesting the creation of mortgage loans to buy apartments under construction or newly built that cannot yet be registeredSantiago Filipuzzi - THE NATION
The dizzying announcements of mortgage loans launched in recent months have sparked a sign of hope for their power to reactivate demand in a real estate market that for months has promised a change of cycle and rising prices. However, those who build the projects celebrate the initiative at the same time that they have begun to publicly request that the entities include in their portfolios lines applicable to the purchase of apartments in a short period of time.
“ We welcome the provision of credit tools to access housing, but developments should definitely be included in these programs. The possibilities of articulating solutions are much greater when construction is in progress: there is more supply of typologies, more locations, much more flexibility and facilities and, in addition, it contributes to the economic cycle because private work generates movement and is linked to all industries and the world of work ,” explained Marcos Juejati, partner and founder of the developer NorthBaires , which is currently developing 150,000 square meters in the city of Buenos Aires. The company that develops the OM projects works with the premium segment with a sale value of its projects that ranges between US$3,000 and US$7,000 per square meter, in its complexes located in the most select areas of the city.
“ The credits changed the mood and improved the expectations of the sector, it also generated a little oxygen for the developers who come with very high costs and with a dollar that was still until a few weeks ago and a feeling of strangulation between costs and prices,” Carlos elaborates. Spina, commercial director of Argencons , the developer with more than 300,000 meters under construction: its latest launch Quartier Bajo Belgrano with units that average US$3,500/m² .
Developers hope there will be credits for apartments that cannot be deeded
Santiago Tarasido, CEO of the construction company Criba, recognizes that although “Argentines are accustomed to operating in crisis contexts,” there is a more fundamental issue, which is that the deficit in housing solutions in Argentina exceeds 3.5 million and with The square meters that are built each year cannot cover the population growth. And on the other hand, the focus is on the AAA market for the simple reason that it is built for those who can pay “almost in cash.”
In this context, the businessman acknowledges that “the arrival of mortgage credit gives the possibility of expanding the offer to other segments. The challenge is how to quickly impact new developments and not just the stock.”
It also puts on the table that for the market to approach more structurally normal conditions, other things are needed in addition to mortgage credit: “ greater openness to the world in materials, services and technology; intermediate credit for developers ; modify the enormous disincentive to hire personnel and to create new companies - in construction the number of employers was reduced 25% in the last 15 years from 26,000 to 20,000; creation of regulatory frameworks that generate more aligned public-private incentives – such as the housing law promoted in Uruguay and reduce costs by generating more competition and productivity throughout the construction value chain.
Along the same lines, Damián Tabakman, president of the Business Chamber of Urban Developers (CEDU), recognizes that the credit will generate a demand from people who otherwise would not be able to buy a property , but he recognizes that the developers were left out.
Buying with credit from the well
While there are multiple credits announced, only one includes, at least tangentially, the conditions claimed by the developers. This is the line of credit from Bancor , bank of the province of Córdoba. This entity finances 100% of the purchase of the property or construction and expansion or completion, and the development companies, which have an agreement with Bancor, are included in the mortgage line.This means that the supply of housing (houses or apartments) or construction on lots that do not yet have title deeds is also available and suitable for being acquired with credit. The key fact is that the same conditions apply as the rest, with the developer being the one who guarantees each operation until the time of title deeds.
Under Bancor's conditions, per applicant (bank clients) a maximum of $90 million is granted, which can be financed over up to 20 years. The capital is adjustable by UVAs with a rate of 4.90% throughout the term.
The initial loan is $17 million (20,000 Uvas), with a payment of around $115,000 and with a required income of $470,000 for the entire family group. Not only can the loan be taken into account for a couple, but also for the parents of both; the line is also for singles. For the maximum amount, the payment is $554,000 and an income of $2,250,000 must be collected. That is, for every $10 million, the payment today is $66,150 pesos. “In this case, the developer is asked to guarantee that the project will be completed on time and in the correct manner, a requirement that limits this possibility to large developers with larger balance sheets,” analyzes Tabakman and highlights the case of Vizora with Remeros Beach where the Macro bank -the same business group as the developer- gives long-term loans to buy in a pit . “It is difficult to extrapolate this experience to other cases,” he acknowledges.
“ The arrival of credit is excellent news for the market, but it is essential to enable credit lines that can be used to buy units in the developments that have already begun, always respecting the characteristics and guarantees that a type of commitment like this requires,” says Daniel Eirín, commercial manager of Saltum, the company that installed the concept of accessible premium developments with its WH complex in the Coghlan neighborhood.
The developer adds that “banks have the opportunity to securitize the developers’ works, and achieve a virtuous circle between the developer, the individual and the bank , which would allow many works to start and the banks to work as seed capital with a large brick-and-mortar backup in which everyone wins.” Saltum is moving forward with a luxury complex where the old Argentina Sono Film studios used to operate, in Bajo Belgrano, where the square meter is priced at approximately US$6,000.
The cases of Uruguay, Paraguay and Peru
Federico Gagliardo, the businessman in the sector who created Vitrium Capital 18 years ago, gives the example of Uruguay, a country with an annual inflation of 3.6% in which up to 80% is financed with rates of 6% or 7.5% over 25 or 30 years. “ The housing law promoted is paradigmatic: it removed the income tax from projects developed under that law, and the VAT for construction and associated services and the property tax ,” explains the developer and affirms that its application generated a boom in developments with more than US$4 billion of investment in 1,375 real estate projects and 290 homes in 13 years. “This case breaks with the fear of politicians of removing taxes from certain industries,” he comments and gives more details: “people can buy with financing and banks even finance part of the advance payment in installments with a credit card.”The developer also highlights the dynamics of the Paraguayan real estate market where this week he presented his fourth project: 01 Vila Asunción will be built in the Ykua Sati area of the Paraguayan capital, in the San Jorge neighborhood, close to two main roads, Madame Lynch and Santa Teresa. This is Vitrium Capital's fourth project in that country where it landed in 2020, in the Mburucuyá neighborhood, with an investment of US$10 million and two towers.
“ Paraguay is a country that offers significant competitive advantages for real estate investment . “Currency stability, favorable investment policies and low tax burden are variables that add up to real coherence in public policies across different government administrations, creating a predictable and safe environment for long-term investments,” analyzes Gagliardo, who clarifies that it also has a middle class that has grown significantly. “A substantial fact for us since we develop products intended mainly for this segment,” he adds.
Today only the Banco de Córdoba allows you to buy with well creditBannafarsai_Stock - Shutterstock
At this point, developers recognize that there are tools that could be incorporated into the market, such as the future asset mortgage, highly developed in Peru. “ We would like to import it, but that requires a legislative change in Congress that is not available,” analyzes Tabakman and explains that another possibility is for the banks to finance the real estate developer to do the work and when it is finished, grant credit to each buyer. .
Looking ahead, Spina expects progress in the money laundering process for the purchase of properties in the development phase . He proposes using the same requirements as the previous one: units in projects with less than 50% progress.
Regarding sales prices, they say they will increase . “Because the cost of construction will not go down and when the available stock is placed, what comes out on the market will come out at a higher price,” analyzes Gagliardo, although he clarifies that the process of economic adjustment will take time. “ Credit is a good start , it helps, but lowering inflation is key. When it is close to 20%, 25% annually there will be greater demand, but when it is less than 10%, it will explode.
www.buysellba.com
