Traditional housing price falls to its lowest level in 5 years

The sale of traditional housing with a value between 420,000 and 736,000 pesos fell to its lowest level in five years during the first half of the year, according to figures from the National Housing Commission (Conavi).

In the first semester of 2018, 59,026 homes were sold in that price range, while in the first half of 2014, 83, 322 units were sold, the highest level since 2013.

In 2013, 62,910 traditional homes were sold and in the following years, sales remained above 60,000 units, but in 2018 these figures have fallen to a record 59,026.

In commparison with 2017, the sale of traditional housing had a decrease of 1.4% in the first half of the year.

The states with the biggest drops with respect to total sales were Colima, with 18.2%; Nayarit, with 15.4%; Querétaro, with 14.4%; Nuevo León, with 13.2%; Zacatecas, with 12.8%, and Hidalgo, with a drop of 10.7%.

Jorge Paredes, President of Realty World Mexico, explained that there are several circumstances that affected the brake on the purchase of traditional housing, such as inflation in general, which increased the cost of living and the inputs for construction.

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“Since the gasolinazo (gradual rise in the price of fuel), the rise on the price of steel rod, inputs for construction, and the increase in interest rates, the purchasing power or income available to buy a home or make monthly payments has been negativley impacted, “explained Jorge Paredes.

Additionally, Infonavit, which is the main financing provider, made it a requirement last year not to appear in the Credit Bureau to grant a mortgage loan, so now many people are not being able to obtain a loan.

Towards the end of the year, the president of Realty World considers that the traditional housing placement will rebound a bit or that at least it will remain at current levels, since there is uncertainty about the way the new president of Mexico will handle the nation’s finances.

TYT Newsroom with information from