The Costa Rican Congress is looking at a law for funding homes valued at less than $150 thousand, for families whose incomes are not above $4000.
This plan "... seeks to provide a housing solution through loans to be granted by public banking entities, mutuals and private banks to enable people to get credit and buy a plot of land, a house or to build on their own lot," noted an article in Elfinancierocr.com.
Costa Rica's Congress has approved a bill that seeks to exempt deposits used to finance long term housing loans from requiring a minimum legal reserved amount.
From a press release by the Legislative Assembly of Costa Rica:
The plenary legislature passed on its second and final debate with the support of 23 MPs bill number 17809, addition to Law No. 7558, the Law on the Central Bank of Costa Rica, to exempt from requiring minimum reserve amounts, deposits and revenues used to finance long term housing loans .
An amendment has been made to Act 3 of March 1985, which establishes a preferential interest rate system on mortgages, increasing the limit of the first band from $35,000 to $40,000.
From a press release issued by the Ministry of Economy and Finance (MEF) of Panama:
The Bill No. 567, amending an article of Act 3 of 1985, which establishes a preferential interest in certain mortgage loans and modifies the first band for preferential interest loans, from $35,000 to $ 40,000, was approved on its third reading by the plenary of the National Assembly, said the Minister of Economy and Finance, Frank De Lima.
The Social Housing Fund (Fondo Social para la Vivienda) in El Salvador will keep the interest rate for social housing construction at 6%.
Francisco Guevara, president of the Social Housing Fund (FSV by its initials in Spanish), explained that this was because the housing supply was less than expected due to red tape delays.
"Some housing projects suffered from lack of technical documents which were in the process of being drawn up, or awaiting inscription in the National Registry. This halted three projects", said Guevara.
The Social Housing Fund plans to provide $46 million in for housing construction, and another $44 million for purchasing a used house.
According to an article in Elmundo.com.sv this year, the Social Housing Fund (FSV) "expects to increase lending both for new and used housing. In addition, it will reinforce credit for Salvadorans abroad and other lines of financing they offer. "
The number of active loans for house purchase up to September has increased by 3.4% compared to the same period in 2011.
During the same period, according to the Panamanian Credit Association (APC) the balance of the mortgage portfolio also reported a growth of 15.4% compared with 2011.
An article in Panamaamerica.com.pa quotes Luz Maria Salamis, CEO of the APC who said, "...
In order to address issues related to urban development and housing finance, a meeting will take place of bankers, developers and city officials, from 3 to 5 December, in Lima, Peru.
A statement of the Guatemalan Chamber of Construction reads:
The Inter-American Housing Union (UNIAPRAVI) in conjunction with the Ministry of Housing, Construction and Sanitation of Peru the fund MIVIVIENDA SA and the Peruvian Chamber of Construction will hold in the city of Lima, Peru, from 3 to 5 December 2012 the III Inter-City Forum on Housing Finance.
In light of rumors over possible changes to mortgage conditions, Nicaraguan real estate developers are asking the country's banks not to go through with them because they would affect the sector’s growth.
Alberto Atha, president of the Chamber of Builders of Nicaragua (Cadur), said that a rumor is spreading that some banks will increase interest rates on mortgage loans by between one and two percentage points and the premium could be increased by 15 %. "We are convinced that such a move would affect and stagnate the growth process that the industry is experiencing." ... although the changes are not yet official, they are holding talks with banks asking for these measures not to be applied in the immediate future. "
The National Assembly has given the final approval to increase ceiling rate for preferential interest to $120,000, which will have a direct impact on the housing market.
The plenary of the legislature approved on third reading bill no. 241, by which the ceiling for preferential interest rates has been increased to $120,000 reported Capital.com.pa.
"The incentives that have been updated by the Act are: Preferential Interest, increasing the lower limit from $30,000 to $35,000, homes valued up to $35,000 will receive a subsidy which covers the entire interests to the corresponding market, and similarly increases the upper limit from $80,000 to $120,000, where homes will receive a subsidy of up to two percentage points (2%) from the market rate," said the Minister of Economy and Finance, Frank De Lima.
President Martinelli announced that the maximum value for a property to be considered for the preferential interest rate will be increased to $120,000.
The measure must be passed in the National Assembly by amending the act, which is expected to happened very quickly.
A current limit of $80,000 has been established as the maximum value of homes that can be financed under the law, which allegedly has led to low-quality housing solutions being built to keep costs within that range.
The Panamanian government has extended for another five years preferential mortgage loans previously registered with the Department of Revenue.
A press release from the Ministry of Economy and Finance of Panama reads:
Preferential mortgage loans previously registered with the Department of Revenue of the Ministry of Economy and Finance, are to be extended for five more years, as was established by Act 8 of 2010 and as has been regulated by Executive Decree # 539 of 30 November 2011. The standard applies to loan contracts which are in the first ten years of their term at the date when the regulation becomes effective.
The International Finance Corporation has granted a loan to Banco General de Panama so that it can offer more mortgages to low-income families.
The $50 million long-term IFC funding , which will run for seven years, will enable Banco General match the maturity needed to finance mortgages for low-income groups.
During the agreement signing ceremony today in Panama City, Executive Vice President and General Manager of IFC, Lars Thunell, said: "The IFC is aiming to deepen the strategic partnership with Banco General to increase access to mortgages. The IFC's support will help Banco General to extend funding for families whose annual income is near or below the average income in Panama. "
State banks will allocate $ 788 million through programs for all social strata.
Banco de Costa Rica (BCR), Banco Nacional and Bancrédito, have placed more than 20% of their portfolios in this area.
In the case of Banco Nacional, the institution will provide $ 535 million of which $ 347 million will be targeted for families with low and middle income.
During this year, the "Caja de Ahorros" (CA) aims to place $170 million in Mortgage Loans.
By the end of August $73,2 million have already been lent and the goal is to double this amount, pointed Rodrigo Arosemena, General Manager of this organization.
Arosemena commented to Panamá América that "...we will focus on promoting savings and we will increase mortgages, mainly those with preferential interest or under $30 thousand."
The banking system has increased its range of mortgage credits with terms of up to 30 years in both dollars and colones, the local currency.
The Costa Rican banking system's housing credit portfolio makes up 31% of 31% of all non-financial private sector loans, measured in colones. As of May year on year sector growth stood at 3.71%, according to the Central Bank.