What happens in the real estate market in Venezuela?

What happens in the real estate market in Venezuela?
What happens in the real estate market in Venezuela?

Large window in the living room with ocean view, one bedroom, spacious and fully equipped. That was the apartment with which he youtuber Mexican Luis Arturo Villar, known as ‘Luisito Comunica’, surprised his followers after buying it in Lechería, Anzoátegui state, located in northern Venezuela.

“When I saw the prices of what properties sell in Venezuela, I was honestly very, very surprised (…) This house that I am about to show you cost me $ 20,000 (…) in very few places in the world you find homes at these prices,” he explains Villar excited before showing his property.

In just over a week the video already has more than 6 million views and 26,600 comments. The Mexican affirms that he knows the situation the country is going through, but comments that it seemed to him “a good time to invest” thinking about the future.

“The real estate dynamics does not stop, despite the COVID, in this case, and the political situation,” he says to the Voice of america Francisco López, president of the Real Estate Chamber of Venezuela.

López explains that the primary market, that is, construction, has been “in a sharp decline” for about ten years. However, in the secondary or second-hand market the situation is different.

Whoever can somehow take their savings, translate them into a property, will never be able to get anything more interesting ”

That secondary market closed 2020 with a 30% growth in economic activity, in which the majority (70%) were rental operations and the rest was buying and selling, explains the president of the Venezuelan Real Estate Chamber.

Regarding the average price, the representative of the sector explains that in 2020 it grew by 9% and the first quarter of this year they registered an increase of 12.5%.

“We in Caracas could be around $ 500 (per square meter), when for example in Rio de Janeiro it is at $ 3,300”, says López, explaining that currently the value is not officially available and that depending on the area and the type of space could increase.

From the country’s Real Estate Chamber, the president points out, they recommend: “Whoever can somehow take their savings, translate them into a property, will never be able to get something more interesting. a little”.

“At the price of a skinny chicken”

López’s recommendation seems to be the premise used by Jackeline Useche when she decided to sell her apartment east of the Venezuelan capital.

The 38-year-old publicist put her 52-square-meter apartment up for sale in 2019, and ended up selling it a couple of months ago for $ 9,000 less than what she claims the apartment was worth and far less than what she bought in 2006.

“I had about four offers, more or less, but most were from strange sources,” says Useche, explaining that in some cases, the seller wanted to buy up to five identical apartments and did not feel comfortable doing business with them.

Useche says that when he bought he got an opportunity in a better area, for double the footage, and, although he does not specify the amount, “at the price of a skinny chicken.”

“This other apartment is totally undervalued, but if you are going to use the money to continue investing it in real estate in Venezuela, I thought it was a good deal”, explains the publicist to the FLY.

The thousands of dollars that Villar, López or Useche speak of seem difficult to save in a country that goes to their fourth year of hyperinflation and where the minimum monthly income is $ 2.50. In the private sector, the average salary is $ 70, according to the Workers Compensation Index of the Venezuelan Observatory of Finance (OVF).

Not surprisingly, in 2011, the Venezuelan government launched the Great Venezuela Housing Mission to guarantee “a decent home” and that, according to official information, it has built more than 3,600,000 housing units.

“There is something for everyone. There are people who can acquire a lower-cost property, there are people who acquire a medium-cost property, and even if there are high-target clients, ”says Daniella Medero, a real estate consultant in Caracas for six years.

Medero explains that despite the pandemic, this 2021 personally and collectively, in his office, “has been very productive.” Only she, comments to the FLY, So far this year it has made about six sales and completed three rentals.

This administrator by profession recognizes the difficulties experienced in the country, but is optimistic and ensures that the expectations for the remaining months of the year “are very great.”

“All an odyssey”

For those who do not have the availability to buy, renting seems to be an option, as reflected in the commented data of the country’s Real Estate Chamber. However, it also has its complications.

The common Venezuelan cannot easily rent “

Yurubi Glod, a 29-year-old accountant, knows. In 2017, she decided to move from Valles del Tuy, a town on the outskirts of the Venezuelan capital, due to security issues and difficulties in getting to work by public transport. Since then, he has rented in two rooms and two annexes.

“Renting here in Caracas is quite an odyssey because they ask you for an exorbitant amount of money for the negotiation, when the rent can be very cheap,” he says to the Voice of America.

When he first moved out, he says, he had to ask for different credits, including one on his five credit cards at the time. He currently lives in an annex in a popular area to the west of Caracas.

“The common Venezuelan can not rent easily (…) I tell you that I have a permanent job and more everything I do additionally, it has cost me a lot to get rent and have the money for the negotiation”, or months of deposit or advances that usually require , confirms Glod.

He explains that his rent, of about $ 70, represents almost half of his regular job salary. In order to supplement her monthly income, she also offers accounting services for different companies and is a manicurist.

According to OVF data, January was in which the category of ‘housing rental’ (which includes different types of spaces, not only residential) increased the most, reaching 35.4%. During the last record presented by the observatory, August, this same item increased 4.1%.

In the midst of the pandemic, the government has announced the temporary suspension of lease payments on commercial real estate and primary residence; Besides the exempt from a percentage of the fee for some basic services for a couple of months through the system known as Patria.

For López, president of the Venezuelan Real Estate Chamber, the fact that the Venezuelan is encouraged to rent denotes “that people think about the future” and that there is “certain purchasing power.”

“Of course we would love the mortgage loans, which we see not yet in the short term, where that money that is being allocated to that rent would be perfect if it was allocated to a quota so that it was private property”He comments.

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