Development companies in Nicaragua believe that profitability in the construction and sale of this type of housing has not occurred as expected due to difficulties in obtaining financing.
The Chamber of Builders in Nicaragua (Cadur) argues that the bond that the government announced earlier this year to facilitate access to financing to acquire affordable housing is not what was expected, and because of this, this segment of the market is not proving profitable.They state that the homes that are still being sold with good results are those with prices ranging between $20,000 and $50,000.These represent"... 60% of sales."
Financing for housing and sustainable urban development will be the topics under discussion at the event to be held on August 22 and 23 in Managua.
The Chamber of Builders in Nicaragua and the Inter-American Housing Union are organizing the event, which will bring together professional financial real estate companies, developers and builders, banks and finance companies, savings and loans companies for housing, cooperatives, investors, and representatives of public entities.
In February 2016 the mortgage loan portfolio exceeded $13 billion, 15% more than was recorded in the same period in 2015.
For the remainder of the year it is estimated that the total mortgage portfolio of the banking system will far exceed what it was in 2105, at a time when there is increasing demand for this type of financing and there remains a significant shortage of low and middle income housing.
In three days of business activity builders and companies in the real estate sector closed deals worth $10 million.
Representatives from the companies participating in the fair stated that 112 homes were reserved worth a total of $3.5 million. Added to this another 200 people signed up to waiting lists and will be completing their reservation process in the coming weeks, explained Ricardo Melendez, president of the Chamber of Builders of Nicaragua (Cadur).
The construction guild says that if the necessary reforms are not made to promote the construction of housing solutions, in 2020 the deficit will reach 2.1 million.
The Central Housing Association Guatemala Chapter (ACENVI), is proposing a series of legislative reforms to promote housing development and reorganize the country, which currently has a deficit of 1.6 million dwellings.
In Nicaragua construction of affordable housing grew by 123% in the first quarter compared to the same period in 2014, and represented 30% of projects in the sector.
On average affordable houses being built in Nicaragua are 60 square meters or less, with a basic design and a total cost of less than $30 thousand, according to data from the Nicaraguan Chamber of Construction (CNC).
In the housing fair held on July 4th and 5th $30 million worth of mortgage loans were negotiated for construction and purchase of affordable housing.
The main reason behind the good results achieved at the fair is the increase from $5,000 to $10,000 made by the Ministry of Housing in the bonus for social housing, a segment that was targeted by the show.
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