Construction & Real Estate
From The Report: Colombia 2013
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The construction sector has experienced consistent expansion in the past few years, registering 3.6% growth in 2012. While this figure is significantly lower than the 10% growth registered in 2011, prospects for 2013 suggest the sector will regain momentum driven primarily by aggressive government spending programmes aimed at closing the gaps in infrastructure and housing. Likewise, the real estate sector is showing signs of reaching maturity, as strong demand for housing and a healthy mortgage system provide access to property and have thus far, prevented speculation. Housing policies, which have traditionally focused on generating demand among the low-income and middle-class segments, are now shifting focus towards developing strategies to control rising property prices produced by the shortage of land in major urban centres. While surging property values and land prices remain a challenge, it has nonetheless increased the potential of the residential leasing market.

Articles from this Chapter

Overview

Buoyant buildings: Major housing and infrastructure projects drive sector development
OBG
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Closely tracking patterns in the general economy, the construction sector expanded by 3.6% in 2012, significantly lower than the 10% gain in 2011. Even so, prospects for 2013 suggest the sector will regain momentum, driven by aggressive government spending programmes aimed at closing wide gaps in infrastructure and housing. Contributing 6.3% to GDP and employing some 1.16m people, the sector’s healthy performance is in the interest of all. HOUSING DEFICIT: Though exact deficit figures are…

Analysis

Room for improvement: Cement industry displays potential while looking to regain momentum
OBG
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Heavily dependent on the construction sector’s progress, the local cement industry took a slight dip in production in 2012. In the 12 months to May 2013 the production of Portland cement, the most commonly used material for infrastructure and housing in Colombia, amounted to 10.79m tonnes, representing a 1.67% year-on-year (y-o-y) decrease, according to the National Administrative Department of Statistics. Total national dispatches followed a similar trend, accounting for 10.43m tonnes, falling…

Analysis

Building a roof for all: Demand drives construction of massive social housing projects
OBG
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Low-income housing has long been stigmatised by false conceptions of small profit margins and unattractive architecture. However, Colombia’s large unsatisfied demand for homes has encouraged the public and private sectors to shift attention towards this segment with innovative project proposals that aim to bypass common setbacks within the sector. GOVERNMENT PROGRAMMES: Prospects for social housing rely heavily on state policies, which have proven successful in channelling resources set…

Overview

Pushing property development: Healthy macro indicators and a good credit system propel the market forward
OBG
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As construction activities regain momentum the real estate market has closely followed, driven primarily by a strong demand for housing and a healthy mortgage system granting access to property over a long-term period. Most indicators suggest the market is coming to a mature stage where booming numbers are not the only positive signs. Nonetheless, obstacles remain, namely surging property values and land prices in Bogotá, where nearly a quarter of the population resides. Much of the real estate…

Analysis

Properties on port: Barranquilla is growing with enormous potential
OBG
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Immeasurable is the word Jorge Enrique Gómez used to describe the future of Colombia’s Atlantic coast. The president of regional real estate association Lonja de Bogotá, Gómez told OBG that the strip connecting Cartagena to Santa Marta holds large development potential and will no doubt receive an influx of national and foreign investment in the years to come. Affectionately referred to as La Arenosa (the Sandy City), Barranquilla was one of the country’s major ports at the beginning of…

Analysis

Resilient rentals: Leasing introduces dynamic conditions to the residential market
OBG
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In times of crisis, property ownership is often seen as one of the safest investment ventures, partly due to secured regular income from rentals. Over the past decade Colombia has built up a strong market for residential leasing and continues to see a number of dynamic factors that are increasing its potential. CONTEXT: In the late 1990s, Colombia experienced a severe financial crisis brought on largely by a haphazard mortgage system and high interest rates. As a result, many people lost their…