The real estate industry complains that lack of credit and interest rates that increased from 10% to 21% are preventing housing construction in the country.
According to Andres Salinas, an executive in the real estate sector, when the Honduran Bank for Production and Housing (Banhprovi), gave out loans at rates of 10%, the fees paid by buyers were smaller, but now "there are no funds and banks are granting some at 18.5% and others at up to 21%, there is no capacity," he 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.
A joint housing project between a bank and the Chamber of Construction will be carried out in Tegucigalpa, Honduras.
The president of the National Agricultural Development Bank (Banadesa), Johnny Handal, and vice president of the Honduran Chamber of Construction Industry (Chico), Oscar Calona signed off on a program for building popular housing.
The project will benefit families earning less than four minimum wages, and will start with almost a thousand houses in Tegucigalpa, which are to be financed with funds that will be raised by Banadesa’s Private Contributions Regime (PAR), the newspaper La Tribuna reported on its website.
Balboa Bank & Trust, will support the Micos Beach & Golf Resort tourism project providing a loan for $2.5 million.
Diana Villeda, chief financial officer of Tela Bay Tourist Development (DTBT in Spanish) announced that an amendment will be made to the syndicated loan agreement, integrating this contribution and bringing the total credit to $26 million.
With the first payout of a $15.9 million from a syndicated loan worth $24 million, construction of the second stage of the tourism project in Honduras will begin.
The banks, Ficohsa, BAC Honduras, Ficensa, Rural Development Bank in Guatemala and Panama's Banco Pichincha had already approved a syndicated loan of $24 million to finance the tourism project.
The touristic development, to be located in the Tela Bay, finally landed funding from 5 financial institutions.
Ficohsa, BAC Honduras, Ficensa, Guatemala's "Banco de Desarrollo Rural" and Panama's "Banco Pichincha" approved a $24 million structured credit to fund this initiative.
Javier Atala, manager of Ficohsa Bank, noted that this project will contribute to the tourism industry and will help promote Honduras as one of Central America's leading tourist destinations.
In February, the sector reported an increase of 4% over the same period of 2010.
The president of the Chamber of Construction, Alejandro Alvarez, explained the recovery is mainly due to private projects in commercial areas of Tegucigalpa and San Pedro Sula.
The executive told Laprensa.hn, "Investors have recovered confidence and the Chamber has done everything possible with private banks for them to engage more in social housing projects."
Government will use resources of PDVSA for the construction of social housing and hydro electrical plants.
The National Electricity Company will receive $ 60 million of available resources to finance the hydro electrical projects Llanitos, Jicatuyo, Patuca and the Aguán.
On funding for housing, the regional vice president of the Honduran Chamber of Construction Industry (Chico), Juan Carlos Sikaffi, said that "these resources would come to battle the financial crisis which exists in the rural sector and that currently has no support from the traditional financial system, mainly because of the risk existing in this type of investment."
The government signed a technical and financial assistance treaty with Germany for $ 64 million.
The funds will go to social projects on environment and governance, housing and support programs for Micro, Small and Medium Enterprises (MSMEs).
"The Honduran Minister of the Presidency, expressed satisfaction for completing successfully the intense negotiation process between both economic technical teams, which led to the signing of a cooperation agreement for $ 64 million," reported website Proceso Digital.
Of 21 social housing projects only eight have been approved with the remaining 13 due to begin the tender process by the end of the year.
The Honduran Construction Industry Chamber (CHICO) indicated that there is a need to make changes to the public works department's (Soptravi) bid process in order to make it simpler.
Alejandro Álvarez, president of CHICO, told Elheraldo.hn that, "we have asked the government to speed up the tenders and housing contracts that the construction sector needs in order to generate employment and encourage development".
The government has signed an agreement with the developer Inter-Mac for the construction of 35 residential projects.
Inter-Mac director, Javier Arguello, highlighted the importance of the project for the Honduran economy, calling it 'encouraging'.
Lobo Sosa, president of Honduras, was present at the signing of the agreement and "thanked national and internation investors, as well as the US government, for continuing to believe in the country.
The construction industry in Honduras has fallen 40% in the last 5 months.
Chico, the Honduran Construction Chamber, asked the government to reactivate a number of public construction projects, to create jobs in this sector.
Additionally, he noted that the banking system has $1.7 billion available, which could be loaned to their industry, as it is very stable and enjoys low interest rates.
The Swedish Cooperation Center has organized a forum between the region’s housing ministries and nongovernmental organizations to promote the concept.
Cooperative housing implies that those interested in buying a house must organize themselves in a cooperative, in turn building their own houses. This model allows up to 30% cost savings.
“This modality allows low income citizens to access adequate housing solutions at a low cost”, reported Elfinancierocr.com. “The concept has proven successful for over 40 years in Uruguay, where over 25.000 families have used it to get high quality residences”.
U.S. consortium Inter-Mac will develop 35 low cost residential projects, each with 100 units.
Spokesperson Javier Arguello remarked that 400 units are already available for purchase. He added that the projects are located in the area known as “Valle de Sula” (Sula Valley), and that they are considering building another in Tegucigalpa.
Newspaper Hondudiario published further statements by Arguello: “each unit features two bedrooms, living room, dining room, kitchen and bathroom. The projects include paved roads, entertainment areas, water treatment plants and areas marked for building schools and community centers”.