Forum Opportunities and Challenges in the real estate sector 2019

On September 11, 2019, the Opportunities and Challenges Forum in the real estate sector was held, organized by ION Financiera, where housing developers, bondholders, partners, business partners and government bodies attended.

During the forum, experts presented an optimistic outlook for the industry and encouraged real estate developers to continue investing in home construction in Mexico.

689A6891

According to the information presented by Softec, it is estimated that in 2019 investment in the industry would be 482 billion pesos. Which is a lower investment amount than the previous year, where 571 billion were invested. However, he affirmed that in Mexico we are facing the greatest opportunity to transform the built environment in history, thanks to the rapid production and occupation of housing; the addition of 60,000 hectares to the urban area in Mexico; and the incorporation of 2.1 million people to the workforce per year.

The experts assured that << without real estate development there is no economic development >>. For this reason, Pablo Benlliure, General Director of Development Planning and Territorial Ordering of the Ministry of Urban Development and Housing maintains the importance of accelerating the processes in the definition of the General Development Plan of Mexico City, which will establish the long-term policies in matters of strategic relevance for the City and which will aim at social cohesion, sustainable development, improvement of the quality of life of its inhabitants, territorial balance and economic transformation.

689A6968

On the other hand, despite the affirmative expectations for 15 years, such as the doubling of the GDP in the cities; the change of autonomous systems; technological changes; the construction of millions of houses; and the production of thousands of commercial and industrial m2, Gene Towle, CEO of Softec, said that there are some development challenges that we will have to face, as well as attracting capital and technological changes.

Faced with this situation, José Shabot, Chairman of the Board of ION Financiera, invited real estate developers not to stop building and bet on the development of Mexico City, which today contributes around $ 349 million of Gross Domestic Product and that could reach the $ 610 million by 2034.

“The formula to achieve the success of a real estate development is to choose land in an appropriate way, well located, close to sources of transport and work, always build in accordance with the law and seek to offer our clients quality and added value to their home” , emphasized Shabot, when recalling that today we have a housing deficit of more than 27 thousand homes in Mexico City alone and to which there are added about 62 thousand new life events annually, between marriages, divorces and labor mobility. .

Regarding these data, ION Financiera joined the dialogue, emphasizing that developers should not only think about prices per square meter, but also in the development of products focused on the final cost that the client will have and the current economy. , remembering that mortgages absorb around 30% of a family’s income and that buyers choose based on the amount of the monthly payment they would pay for their home loan and not on the square footage.

689A7166

ION Financiera, assured that it has been a good year in the placement of individual loans and bridge loans. “In the case of our business clients, we take care that the technical, financial and legal capacities of the project are in order so that there is no past due portfolio”. It was also highlighted that between 8 and 12% of home purchase loans have annual prepayments, so many of them may be customers of a new home, thus boosting the dynamics of the sector.

ION Financiera has managed to position itself as a relevant player in the real estate financing sector, both for construction and home acquisition. With coverage in 7 states of the Republic, it has in its history more than 9 thousand financed units, with an amount exceeding 10 billion pesos and they foresee a sustained growth in 2020.