Access to mortgage loans in Mexico has decreased due to poor housing affordability due to high prices and low wage growth, the BBVA bank warned this Wednesday.
“Rather than an issue of higher rates, we are seeing an issue of higher home priceswhere some affordability has been lost,” said Carlos Serrano, chief economist of BBVA Mexico, when presenting the “Real Estate Situation” report.
According to the document, total mortgage credit during the first half of 2023 fell by 4.1% in the number of loans and 8.6% in the total amount.
This in a context where the credit of commercial banks and the Housing Fund of the Institute of Security and Social Services for Workers (Fovissste) decreases, in contrast to the Institute of the National Housing Fund for Workers (Infonavit), where there is an increase.
The bank highlighted that, in this period, access to mortgage loans only grew in 10 Mexican entities, with Baja California leading the way with an increase of 21.3% in the first six months of 2023, only above Sinaloa, with 17.3% , and Nayarit, with 16.4%.
Serrano pointed out that, although the interest rate of the Bank of Mexico (Banxico) has remained at 11.25% since March, this is not the factor that is reducing new home purchases.
He explained that it is due to the relationship that exists between salaries and the price of housing, since the average rate of increase in housing prices is 6.1% compared to a 2% growth in salaries.
“Household income is not enough to purchase housing“, said.
Social interest housing, the one with the greatest potential
Serrano highlighted that “social interest” homes, with mortgages from 365,000 pesos and up to 1.1 million pesos (between $35,616 and $60,273), are those that present the greatest demand potential in Mexico.
In this sense, he said that the report estimates a potential demand for social interest mortgages close to 3.2 million homes.
Marissa González, BBVA Research specialist, explained that the average amount of social housing increased by 3.6% between 2016 and 2023.
Likewise, he explained that the greatest demand is expected in homes considered popular and traditional, which They represent mortgages of up to 1.1 million pesos ($60,273).
In addition, González said that the most attractive Mexican states are the State of Mexico, Mexico City, Jalisco, Baja California, Nuevo León and Veracruz, which concentrate 50% of the total expected demand.
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