Time to acquire housing: there are more houses than people interested in buying

Analysts suggest that this is the opportunity to acquire housing in Colombia

Time to acquire housing: there are more houses than people interested in buying

If you are thinking in buying a house or considering how to invest your savings, this may be a good time to buy real estate in Colombia. Due to the large supply of homes built and the financing options currently available, analysts say that this would be an opportune time to acquire own home.

Leer en español: Momento de adquirir vivienda: hay más casas que gente interesada en comprar

According to a report from the Colombian Chamber of Construction (Camacol, in Spanish), in the last 15 years the contributions of the building construction sector to the national economy have increased considerably. Unless you work in that sector, where jobs have doubled, you probably would not care about those developments. However, the key point here is that the demand is not growing at par with the supply. Recent data indicate that while construction has grown rapidly, housing sales have decreased in recent years.

In the framework of the 9th Housing Forum, the Chief Economist of BBVA Research for Colombia, Juana Tellez, said that "the supply of housing in Colombia is adjusting, but progressively, which shows a large accumulation of homes built without selling". In short, there are more houses than people interested in buying.

In this sense, those who are thinking about buying a home could have a window of opportunity to acquire their own house or apartment, before the balance between supply and demand is restored. As Camacol's report points out, currently "there are better conditions for households to have access to a formal home since the availability of them is now greater".

Additionally, there are favorable conditions in terms of financing. According to information published by El Tiempo, interest rates on mortgage loans register one of the lowest levels in recent years. Although for many it is not ideal to take a loan for 30 years, even if that allows having the lowest interest rates in the market, there are alternatives to 15 or 20 year loans, which also allow to take advantage of the current low rates.

At this point, it is important to remember that financing options depend ultimately on each person's work and credit history. Although the monthly installments of a 30-year loan will inevitably be lower than those of a shorter loan, not everyone has access to a credit with those characteristics.

Also, it is necessary to bear in mind that, when buying, the initial payment and the credit obligations are not the only expenses. We must also consider the costs related to taxes, deeds, certificates, and documents, in addition to all the additional costs involved in acquiring a property. According to a simulation made by Metrocuadrado, the largest real estate website in Colombia, when buying a second-hand home of $ 200 million pesos, you would have to allocate approximately $ 2'331,565 pesos for notarial expenses.

However, given the current conditions of the housing market, this could be a good time to invest in real estate in Colombia, before the available supply is brought back into line with demand.

 

Latin American Post | Paula Bautista
Translated from “¿Pensando en comprar casa? Este puede ser el momento”

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