Although the country recently saw an improvement in the Gross Domestic Product (GDP) for the second quarter of the year, with growth in 12 industries, including civil works, on the other hand, building construction fell and continues to show indicators that do not react towards positive terrain.
You can read: Public land tender launched for construction of VIS and VIP housing in Bogotá
According to recent data from Dane, from May to June The economic activity of residential and non-residential building construction fell by 2.8% with an economic movement of $5.5 billion. A year ago, this activity had grown by 4.6% and contributed $5.7 billion to the country’s product.
This dynamic is explained by a general reduction in residential production (-2.9%), non-residential production (-2.5%) and investment in housing (-1.4%). In particular, thendichousing owners, measured by national accounts, They have accumulated five quarters of negative variations, which add up to the 25 months of decline in sales in this segment.
For Guillermo Herrera, president of the Colombian Chamber of Construction (Camacol), this result has harmed the economy, the indicators “they are worrying” and are the result of a context to which the Chamber has been drawing attention for months.
“On Tuesday, the data from the DANE Building Census were published, and there are patterns that need to be reversed. For example, in the second quarter of this year, the area in progress, understood as the number of square meters currently under construction, fell -3.4%. The area started also showed significant falls (-13.4%), while the area that is finishing work and the area that is stopped grew moderately,” Herrera explained.
Also read: Home sales are expected to grow by double digits by the end of 2024
Construction
THE TIME file
With these indicators, The union leader believes that the sector requires measures that will allow it to grow again. He mentions that on this front it is essential to regain the trust of Colombians, for which it is necessary to generate signals that materialize in better conditions so that they can become property owners.
“Banks have taken the lead on this front and we hope that the reductions in interest rates by the most important financial institutions will begin to generate a better sales pattern in this second half of the year. However, it will be essential that the commitments of the Pact ‘The Contribution of Habitat to Economic Reactivation’, signed on August 9 by the Ministry of Housing, the National Savings Fund (FNA), Asobancaria and Camacol, allow progress to be made on a reactivation agenda that reverses the drop in sales, generates employment, and boosts sales and construction starts,” he pointed out.
In addition, it is considered vital to guarantee in the 2025 Budget the resources for the allocation of the 50,000 family housing subsidies of the Mi Casa Ya program and the money for the coverage at the rate that is also part of the program.
“Additionally, we believe that additional efforts are needed to boost the VIS segment and middle-class housing. On this issue, Camacol has been proposing solutions to the National Government for several months that, with a relatively low investment of resources, can boost the sale of around 145,000 homes, which would inject into the economy an investment by households of around $33 billion. This proposal puts sustainability at its core and will contribute to our goal of ensuring that 50% of the homes delivered in 2030 are sustainable,” he emphasizes.
You may be interested in: Starting August 20, there will be closures on the Bogotá – Villavicencio corridor
Construction of housing and civil works.
Courtesy – BBVA Research
On the other hand, civil works are revived
According to data revealed by Dane, the construction of roads and railways, public service projects and other Civil engineering works grew 14.4% in the second quarter, This is a major step forward, considering that the indicator fell by 17% a year ago. In terms of money, the sector moved more than $2.7 billion in the quarter, while a year ago it only did so in $2.4 billion.
Likewise, specialized activities for the construction of buildings and civil works grew by 2.4%.
For the Colombian Chamber of Infrastructure (CCI), this is explained in particular by regional dynamics but not at the national level.
“In the construction production indicator, growth was recorded even above 100%, such as in elevated roads and bridges, which is a category that included, for example, the Bogotá metro viaduct, as well as ports, for example, the Port of Antioquia. In fact, the indicator reported growth above 112% in elevated roads and 154% for ports,” mention.
But for them, more projects must be implemented to maintain this indicator and prevent the declines seen a year ago.
Read also: Civil works production continues to grow, but roads continue to decline
“The key message here is that, although this dynamic is interesting, let’s not leave it here. This indicator may be temporary to the extent that, if there are no more projects, this indicator and this good news will fall,” explains the association.
Despite this, highlights the importance of growth and believes that the sector is beginning to stabilise, but that there is no need to be complacent.
“We are seeing a significant effect compared to the previous quarter, but it is not because we are already doing well. On the contrary, I think it is important to maintain a cycle of large-scale projects and accelerate the next generation of concessions,” they said.
Paula Galeano Balaguera
Portfolio Journalist
