REAL ESTATE

Cheap houses got the market

07-02-2009 | STAFF

Two level homes and bungalows close together are the new tendency, but they are very small and located outside the city center

Panama Star PANAMA. The construction sector is in trouble and it is expected that this year will only grow between 2. 5 and 3 percent.

However, these figures have not discouraged the developers and proof of that is that the Housing Developers National Commission is organizing a fair that will take place at the Atlapa Convention Center on July 3.

Developers are building houses which are very close together and two level homes, to reduce the side of the plots, while in theory having more spacious houses.

The reality is that the houses on offer are considerably more expensive and smaller than those that were built five years ago when the plots and room sizes were bigger.

Recently a woman, who bought one of these houses in Arraijan, in a newly built development, launched a lawsuit against the promoters, because her home was uninhabitable due to the amount of cracks covering almost every surface of the building.

The Consumer Protection Authority, ACODECO, is currently investigating the case and it is expected that more homeowners in the same neighborhood will join the lawsuit.

Another frequent complaint is the lack of water in these new developments, especially in the areas of Arraijan, Chorrera, Brisas del Golf and Praderas de San Antonio, and others.

The Convivienda Fair president, Manuel J. Gonzalez said that 19 promoters will exhibit 80 housing projects with prices ranging from $22,000 to $500,000.

Nearly 80 percent of the projects shown are below the $80,000 threshold and benefit from the preferential interest rate law.

The rest of the developments are located in mountains and beaches or are high cost locations.

The 19 promoters who are taking part in Convivienda control 63 percent of the market and last year they built 4,862 residential units and their sales generated $406 million.

This years they are planning to build 5,115 homes that could generate $470 million.

Gonzalez Ruiz feels that it is an achievable figure, but recognizes that the sector is going through a slowdown, a product of the global financial crisis and increases in the cost of construction materials.

The previous fair generated $30 million in sales and the organizers expect to obtain similar result in the July event. Nine banks will be present at the real estate exhibition.