Rising prices and loss of purchasing power swallow up the possibilities.
SANTO DOMINGO – Two representatives from the construction and real estate sectors warned yesterday that rising prices, coupled with reduced purchasing power, are hindering the possibility for most Dominicans residing in the country to access low-cost housing.
Engineer Rafael Durán stated that the sector is currently experiencing "one of its worst periods" since the enactment of Law 189-11 on trusts. He noted that construction costs have risen to levels that make projects inaccessible to the target low-cost market.
He explained that in recent years, material costs have steadily increased, while labor costs continue to rise due to a shortage of skilled workers. This situation, he specified, has considerably increased the final price of the units .
Durán indicated that these increases coincide with a stagnation in purchasing power. Professionals such as teachers, nurses, and doctors without private practices continue to receive salaries similar to those of eight years ago, reducing their ability to obtain long-term financing.
The engineer stated that approximately 70% of low-cost buyers today are Dominicans residing abroad , because a significant portion of the local population has lost the ability to pay.
Difficulties in purchasing and a slowdown in sales
Alenny Garabito , a real estate advisor specializing in low-cost housing sales, agreed that the market has changed drastically . She explained that, although the price ceiling for low-cost housing has increased from the initial RD$2.3 million to over RD$5 million, the income of potential buyers has not grown at the same rate.
He pointed out that to acquire an apartment under this scheme, a person or couple must generate a combined income of more than RD$100,000 or RD$120,000 per month, which excludes a large part of those who theoretically make up the target audience.
He indicated that many interested parties earn between RD$30,000 and RD$60,000 and do not qualify for mortgage loans, which has reduced demand. He added that the down payment also presents an obstacle, because families must continue paying rent while trying to complete the required contribution.
The advisor explained that, although programs like “Happy Family” serve as an alternative for lower incomes, the available supply is still insufficient to meet the real market demand.
Garabito stated that sales have slowed even in areas that previously showed dynamism, such as Villa Mella and Bajos de Haina . He said that some projects outside the high-end low-cost market have maintained a better pace because their target market has greater purchasing power.
Approval delays and migration to other segments
Engineer Durán added that the slow permitting process has also exacerbated the decline in this sector. He indicated that, while processes related to the Ministry of Housing, (MIVHED) are proceeding normally, other institutions such as the Ministry of Environment, INAPA (National Institute of Drinking Water and Sewerage), municipalities, and the Ministry of Tourism (Mitur) are experiencing significant delays.
He argued that these delays postpone project execution and increase financial costs, discouraging builders from maintaining their focus on low-cost housing.
Both professionals emphasized that the situation requires coordinated measures between the public and private sectors, with the purpose of ensuring that Dominican families can access decent housing under viable conditions.
