What has to happen for more Uruguayans buy a home with a mortgage credit? That was one of the questions that was raised in the Scotia Talks of Real Estateorganized by Scotiabank. The meeting also discussed how demand changes when there are fewer and fewer people per household and what areas of Montevideo and its surroundings have room to continue growing.
Between 10% and 15% of buyers arrive with a mortgageas estimated Fabián Kopeldirector of Kopel Sánchez. The businessman believes that there is room to add another group of similar size. He said that rates in Uruguay are reasonable compared to other countries and that there are homes that could be purchased with a 20-year loan and an initial payment of between 10% and 15%. The problem, in his opinion, is that many people are unaware of these conditions.
Along these lines, Kopel proposed that banks, including the Mortgage Bank of Uruguay (BHU)create a joint campaign to explain how credit works and how much is needed to buy. He said that it is difficult for developers to allocate part of their commercial team to promote a product that is used by a small portion of their customers. “We have grown tired of wanting to do things with banks”, he stated.
The businessman pointed out that there are households that need a subsidy to access a home, even when they can save two salaries to request the loan. Among those who can pay a fee, he said, the freedom to move that renting offers is also important. That is why he proposed that a young buyer can take out a mortgage to purchase a apartment as investment and continue renting in the place where you prefer to live.
Regarding the company’s plans, Kopel spoke of the project “The Eagle” in Atlantis that promote together with Luis E. Lecueder Studiowhich is designed for about 10,000 people. Kopel added that a good part of the firm’s projects are financed with contributions from shareholders, mostly Uruguayan families. This allows you to study and decide the purchase of land as opportunities arise.
In Montevideorecalled that the company opted for Bulevar Batlle y Ordóñez with the Aventura Boulevard building. According to him, at the beginning they had to offer lower prices than they understood the units were worth to attract buyers in the area. He also argued that it should be easier to combine the benefits of different promotion regimes in the same project. He gave the example of the Independence Squarewhere he would like to be able to build a building with office, residential and garage floors.
Kopel said that a good part of those who buy their apartments They do it as an investment, although when designing them the company thinks about the people who are going to live there. For a unit to be rented easily, he noted, it is important to incorporate technology as well as solve basic issues, from avoiding leaks to ensuring that the doors close properly. “We make buildings that we think about today and see them completed in five years,” he said.
Fabian Kopel. Photo: Scotiabank.
On the other hand, although Uruguay’s population is barely growing, the country may continue to need more housing, according to experts who spoke at the event held by Scotiabank. In that sense, Javier Lazarofinancial director of Deeper Groupexplained that between the 2011 and 2023 censuses the average number of members per household went from 2.8 to 2.5. According to their calculations, this reduction represented a need of almost 14,000 homes per year during that period.
Lázaro expects the average to continue falling, although at a slower rate. That, he said, will lead companies to think more about those who live alone and older adults when deciding what type of apartments to build. He also pointed out that the Entre Todos program can grow and reach families with incomes below those usually had by buyers of promoted housing.
Estefania Leal/El Pais Archive
In the case of the mortgagessaid that the rates are low in relation to what has been usual in Uruguaybut there are ideas about credit that discourage the purchase. He gave the example of a 25-year-old person who takes out a loan for 30 and believes that he will continue paying for the same one-bedroom apartment until he is 55. If his needs change, he explained, he can sell that first home and buy another.
The CFO noted that Altius works in Mexico, Panama y Paraguayin addition to Uruguay, and that the profitability of the projects is usually lower in the Uruguayan market. He linked it to the lower risk that investors see in the country due to political stability, compliance with contracts and the continuity of programs such as promoted housing. “In Uruguay they invest with pleasure and in the rest of the countries that I mentioned they do not invest,” he said about some of the group’s international investors.
He added that, even among those who have experience in the financial marketsthere are investors who buy real estate to protect part of their assets and diversify their portfolio. For the company, another factor in its favor is that the local bank finances the construction. The challenge, he maintained, is for this credit to also reach more buyers.
Nicolás Zuchowicki, Javier Lázaro and Fabián Kopel. Photo: Scotiabank.
Before arriving in Uruguay, Caral Group developed first home projects in Lima y Guayaquil. Paul SeminaryCEO of the firm, said that in these markets most of the operations revolve around the mortgage credit. In Uruguay he found another way to sell at the well. He argued that the benefits of promoted housing attract investors who buy units to rent, which helps finance the start-up of the projects.
As an example, in Hábitat – a project that the company has on Italy Avenue– The company sought to sell both to investors and to people who wanted to buy with a mortgage to live there. Seminario said that taking this second audience into account changes the search for land. While an investor may first look at a corner or a main avenue, for someone looking for their own home a secondary street may also be attractive.
The businessman appreciated that in Uruguay the land is registered and that properties can be found with agua y electricity. In Lima, he explained, infrastructure difficulties concentrate competition for the same square meters. In UruguayOn the other hand, he maintained that special attention must be paid to the weight of the land in the project because of what it costs to build. According to their estimates, the incidence of the land can be around 10% to 11%. If it reaches 15%, he said, the numbers stop closing. “I don’t feel comfortable building without a bank. First because I need the bank to sell mortgages,” he stated.
seminar attributed to the political stability Uruguayan decision of Peruvian investors to accompany the company in the country. He said that the permits can take time, but that the requirements in Uruguay They are predictable. For a developer, he explained, that certainty matters because decisions are made for projects that can take several years.
Fabián Kopel and Pablo Seminario. Photo: Scotiabank.
For its part, Nicolás Zuckowickifounder of Ixosaid that the effect of rates and the cost of financing depends on the type of project and the public it targets. A high-end building, for example, may be less sensitive to some of those variables. “Looking for 10 clients worth US$2 million is not the same as looking for 300 clients worth US$200,000,” he exemplified.
The businessman questioned how much market studies can say about homes that are not yet offered. In his opinion, there is demand for different proposals, but to make them concrete it is necessary for someone to finance them and for public organizations to be able to evaluate projects that deviate from the usual. He also said that developers have room to take greater advantage of the exemptions on the import of materials and access technologies that are used in other countries.
“What brought us here is not going to take us there,” he said when talking about what Uruguay can do based on its institutional stability.
Regarding Montevideo, he highlighted the city’s link with the promenade and pointed out that the infrastructure that already exists can be better used. Build in areas that have sanitation and power lines, he said, allows for more use of those services. At the same time, he stated that the growth of the metropolitan area requires new urban centers, with their own services and public transportation, so that those who live outside Montevideo have less need to move to the capital.
Along these lines, Seminario also spoke about growth towards the east and its effects on traffic. He said that, when he arrived in Uruguay from Peruthe car trip from Carrasco until the Dive At eight in the morning it took him about 15 minutes and today it takes him about half an hour. In that sense, he raised the need to have a tram along Italia Avenue to speed up times to and from the east and said that developers can help solve part of the mobility problem in the capital and part of Cannelloni if they do projects that combine housing with other uses. In construction, he gave prefabricated bathrooms as an example and proposed taking advantage of certifications to speed up the approval of components that are produced in series.
Looking ahead to the next five years, Zuckowicki predicts that artificial intelligence and other technologies gain space in administration, management and work. One of the challenges, he noted, will be to incorporate tools that allow tasks to be done with fewer wages, because these changes may encounter resistance in the workplace.
Source: www.elpais.com.uy
