Lima residential property still hot!

Peru’s housing market has fared well for the past two years after Peru underwent a meagre economic growth during the global meltdown in 2009.  The country’s economy made a strong comeback in 2010 with an 8.8% growth and with 6.9% in 2011, according to the Central Reserve Bank of Peru (BCRP).

In the fourth quarter of 2011, the average price of homes sold in Lima Metropolitan Area was up by 19.9% from the previous year, to PEN 262,043 (US$ 99,449), according to the consultancy Peru Tinsa.

Large demand has driven house sales up by around 27.1% to 6,990 units sold during the year to Q4 2011. Lima homebuyers are now focused on units whose value ranges from PEN 100,000 (US$ 37,736) to PEN 200,000 (US$ 75,471).

In 2010, Lima Metropolitan Area and Callao had recovered with a 12.8% home sales growth after its 2009 slump, according to the Banco Bilbao Vizcaya Argentaria (BBVA) Research. The recovery was brought by rapid economic growth, attractive financing conditions, higher consumer confidence and increased jobs.

Lima offers a wide variety of homes ranging from US$ 15,000 to US$ 2.8 million, according to the Peruvian Chamber of Construction (Capeco). The most expensive one is a 700 sq. m. apartment found in San Isidro that costs around US$ 3 million, while the cheapest costs US$ 15,429, a 45 sq. m. apartment in Carabayllo.

Capeco’s study showed that Lima’s best-selling homes are priced around $30,000 to $50,000. Districts with higher effective demand were found in San Juan de Lurigancho (10.83%) and Los Olivos (10.38%), districts that actually belong to low socioeconomic status.

Meanwhile, the districts where most projects are carried out were at Santiago de Surco – construction covers an area of 974,000 m2. It was folloed by Miraflores (681,000 m2) and San Isidro (540,000 m2).

Along with the expected moderate economic growth in 2012, the housing market is likely to surge as well. Housing sales is likely to fare better with the help of lower mortgage rates, improving public investment and Peru’s economic strength. Construction sector is also predicted to grow by 8% in 2012.