Although for this year there is a positive perspective regarding the dynamism of the real estate in the country, the main challenges to continue in this field will be to overcome the inflation, which in turn can put pressure on the issue of hikes in interest rates, according to an analysis of the platform Ninth.
The real estate platform presented the results of its Real Estate Sector Perspectives survey for 2022, applied to more than 800 real estate advisors, which suggests a recovery of the real estate market in 2021, after the impact that the start of the health emergency had on it current.
“The inflation trend that we have seen in 2021 and that will continue in 2022, is the main factor of concern for advisors because they know that inflation can of course raise property prices significantly and therefore creates difficulties for people to be able to access the real estate market”, explained Karim Goudiaby, CEO of Neximo.
According to Neximo, inflation has had a cost in production costs, which according to its calculations has been 20%, for which it is expected that said impact will be reflected in the final offer towards the second quarter of 2022.
“Inflation will have increases in construction costs and therefore in housing prices,” said Goudiaby.
Given this scenario, the founder of Neximo noted that an effect of inflation, which ended 2021 at 7.4%, is the pressure on interest rates, so a rise in rates on mortgage loans is expected during 2022.
“Surely this will have an impact on interest rates. Although we have experienced a very generous period in interest rates in Mexico, with single-digit rates, we think that our rates will rise again during 2022,” Goudiaby said, adding that this will depend on the strategy of each bank, since Mortgage credit is one of the most competitive products among financial entities in the country.
Middle segment, with good perspective
Goudiaby highlighted the recovery that the real estate segment had during 2021, after the impact that the start of the health emergency meant in it.
For the specialist, this was due to mobility in certain segments of the population, as well as the demand that persists despite the economic impact of the contingency.
“The fact that the real estate sector was maintained was because many people took shelter and considered that real estate is a long-term patrimonial asset that can improve their patrimony; We have seen people who during the crisis have decided to sell their property to recapitalize and we have seen that they have taken advantage of this period to expand their (real estate) portfolio,” Goudiaby said.
According to the founder of Neximo, during 2021 the real estate market has been modified according to the needs of the demand. “What we have seen is mainly the willingness of people to have larger spaces, many times further from the city centers, but also the willingness to look for a lower price segment.”
In this context, Goudiaby highlighted that average-priced housing has had greater dynamism compared to higher-value real estate. “The demand in the middle segment has increased a lot when the demand in higher segments in properties, for example, in Mexico City above 5 million pesos have suffered a lot during this period.”
According to the Neximo survey, 52% of the agents surveyed see more dynamism in the middle-income housing market, followed by residential (with 30%), social (16%) and plus with just 2% of favorable outlook .