This is how they have evolved since 2022 in Colombia

2023-08-20 07:28:12

Bogotá — The housing business is among the most affected by the increase in interest rates and inflation in Colombia, which has resulted in higher costs for builders due to the increase in the cost of key inputs for their activity, which has been hit in this context due to lower sales.

It is estimated that the sale of new housing during the first half of 2023 was 64,266 units, which meant a significant drop compared to the 137,531 sold in the same period of 2022, according to figures released by the Colombian Chamber of Construction ( Camacol).

Part of the drop in sales is precisely explained by the delay in the disbursement of government subsidies and higher rates on mortgage loans, which have skyrocketed as a result of the monetary policy exercised by the Banco de la República to control inflation. .

However, these mortgage loan rates have begun to drop in pesos, after the peaks experienced in recent months, according to a balance sheet from the Ciencuadras real estate platform.

How have mortgage credit rates evolved in Colombia?

Mortgage credit rates for the purchase of new and used housing have experienced a slight drop between March and June of this year in some segments such as low-income housing (15.03%) and No VIS in pesos (17.53% ).

However, they did pick up in UVR both for low-income housing (21.60%) and No VIS (23.56%).

Are mortgage credit rates yielding?: This is how they have evolved since 2022 in Colombia

The CEO of the Colombian fintech Creditop, Daniel Garzón, explained at the time that the main difference between a loan in pesos and UVR (Real Value Unit) lies in the susceptibility of the variation in the value of the credit over time.

The analyst indicates that UVR loans are characterized by expressing the amount of the mortgage loan in a unit that can increase or decrease according to the behavior of inflation.

For their part, loans in pesos are characterized by maintaining a fixed value over time and have two payment alternatives: capital installments (the installment decreases throughout the loan) and fixed installment (constant monthly installments).

Last March, the mortgage loan rates in pesos reached a peak of 15.76% for low-income housing and 18.07% in No VIS.

In the case of UVR loans, last March they reached 21.45% in low-income housing and 23.19% in No VIS.

In Colombia, according to Ciencuadras, the supply of new housing in Colombia is supported by 51.16% by VIS housing and 48.83% by Non-VIS.

In 2022, Non-VIS housing represented 55.86%.

Housing prices in Colombia

According to the platform’s report, compared to the first quarter of the year, the sale value of used housing nationwide fell 2.7% in apartments and a slight 0.15% for houses.

On the other hand, rental fees on residential properties grew by 8.1% for both houses and apartments.

While houses present an increase of 19% on average, apartments 17.1%.

Medellín leads the sale of new housing with 14% of the total, which corresponds to 8,000 Non-VIS units and 2,000 VIS units at the end of the second quarter of the year.

On the other hand, there has been a decrease in the purchase of used real estate in cities such as Bogotá (-2%) and Barranquilla (-1%).

On the other hand, in Medellín it increased slightly (+0.36%), maintaining a good supply of real estate.