The lack of confidence among Puerto Ricans in the general economic crisis has exacerbated the problems in the construction sector which is experiencing one of its most sensitive stages.
With the real estate sector stagnated, rising land prices and construction materials, the sector is undergoing an acute crisis.
This follows from the most recent study of trends in the housing market in Puerto Rico of the company Technical Studies.
According to Graham told Efe Castle, economist and manager of that study, low consumer confidence is affecting the demand for housing, which is shrinking.
The consumer today feels very insecure and not have good expectations of improvement for the future, so it prefers not to buy a property at this time.
Castillo stressed that the report shows that most Puerto Ricans believed that their economic situation is worse than before and that do not foresee an improvement.
This situation is mainly due to the added effect of increases in prices of water, electricity, gasoline and most goods and services in general.
This is great inflation of 8.9 percent and the reduction of 15,000 jobs on the island, more than half in the manufacturing industry during the current fiscal year, according to the Negotiated of Labour Statistics EE. UU.
This has been a deteriorating financial situation and an increase in personal bankruptcies by 21 percent, business bankruptcies by 15 percent, rates of delinquency in the overall banking in a 5.30 and the mortgage on a 6.3 in the third quarter of 2007.
For these reasons, the process of qualification when purchasing a home is much stricter when considering the credit history of prospective buyer.
"Everything is related to increases in the cost of living and many people are under an obligation to arrears. This reflects the weakness of the economic situation and the government's fiscal situation," said Castillo.
Further compounding the plight of the mortgage banking law attorney who was recently signed by the governor of Puerto Rico, Anibal Acevedo Vila, and prohibiting notaries negotiate their rates below 1 percent.
According to the Association of Mortgage Banks of Puerto Rico, this ban could double spending on legal mortgages other than social housing.
On the other hand, have seen reductions in price of the properties of projects at the periphery of urban areas in housing estates where there are many houses for sale.
"There are all elements for a decrease in the value of their homes as the reduction in demand, excess inventory (depending on region and product), low expectations, poor economy and oversupply," said the economist.
The homes "ranging from 120,000 to 250,000 dollars are those that are sold more easily, contrary to those worth more than 400000 U.S. dollars," said Castillo.
Many of those property owners are being forced to rent their houses because they can not sell them.
However, changes in the parameters of FHA loans and a government tax credit that can reach $ 25,000, have helped to lower market segments, as these programs have made it possible for people who were unable to buy a home might so.
The crisis in this sector ha ido en aumento y no improvement, at least in the near future.
"We do not see a picture of growth but of stagnation and challenge for the next two years. Even though then the market will improve," said the economist.
"Despite the crisis in Puerto Rico were sold 11,015 new units in 2007, a good number for an island so small, even in years of greater economic strength were sold around 14,000 units," he added.
