Increase in construction prices lower Real Estate sales
The increase in the price of construction materials is worrisome and is lowering housing sales in the real estate sector, according to the president of the Builders and Housing Promoters Association (Acoprovi), Fermin Acosta. He also discussed the high price of construction materials and the interest rates and called on the government and the monetary authorities to find a solution.
Last Thursday, the Hardware Stores Association (Asodefe) complained that the price of cement had increased by nearly RD $45, regular paint by nearly RD $200, PVC tubing (1/2) by RD $50 and a sheet of tin roofing, RD $40, and the prices affect a large part of the most commonly used construction materials such as re-bar, where the price of a ton went up RD $6000.
Acosta said that these problems reduced people’s chances of acquiring a house or an apartment, and so reduce the housing deficit in the country. He argued that after the last tax reform the prices of building materials that are used in the construction industry have gone up, the same as the interest rates.
This combination makes it impossible for the builders to meet their commitments towards their clients at the moment of negotiating a housing unit. Acosta does not believe that the increase in the prices of building materials is due to the approach of Christmas, but because of the economic measures taken by the government and the monetary authorities.
Acosta does not believe that the increase in the prices of building materials is due to the approach of Christmas, but rather for the economic measures taken by the government and the monetary authorities.
He said that the government should start a dialogue in order to open up the economy with the idea of pouring fresh resources into the market which will lower interest rates.
He also said that the government should push for the approval of the Regulations for Law 89-11 which is the Law on Mortgages and Trusts, which has passed its deadline. He added that there are regulations in existence, such as the one on the economic qualifying of housing of the National Housing Institute (INVI), the single window, that have advanced things very little. He feels that the government should push these regulations to see if this law causes more and cheaper resources into the market.
In his judgment, the increases in the prices of materials is paralyzing the sales of housing units in the market, which presents a difficult and worrisome panorama, and
we do not see the government taking any measures.
Cement, which was sold at between RD $275 and RD $280 a bag is now between RD $315 and RD $325. Re-bar, which he said was sold a few days ago at RD $46,000 a ton, is now selling at RD $52,000.
Regarding normal paint, where the price was RD $345 a gallon, it is now selling for RD $550, according to the hardware store owners. A sheet of zinc roofing saw the price go from RD $200 to RD $240 and PVC ?” tubing went from RD $150 to RD $200 a piece.
Source: Dominican Republic Live
Category: DR News |