SANTO DOMINGO.- From November 2022 to the same period in 2023, rental and leasing is listed as the third category within economic activities that showed the main increases, according to a report from the National Statistics Office (ONE).
According to the National Classification of Economic Activities (CNAE) divisions indicator, measured through the Producer Price Index for the Services sector (PPI Services), the increase in rental prices reached 13.93%. Other areas that saw increases were postal and courier services at 18.30%, and security and investigation at 14.87%. According to the report, these activities contributed positively to the variation over the last 12 months by 0.45 percentage points.
The Producer Price Index for the Services sector (IPP Services) is a statistical indicator that measures the average percentage change in the prices of a basket of services characteristic of national production, in a given period, which are collected and processed every month, according to the data provided by approximately 160 companies that offer services both in the national and international market, says the ONE report.
The report adds that the main decreases were obtained in travel agency and tour operator activities and reservation services and related activities, with -2.63%; storage and transport support activities, with -2.16% and air transport, with -1.06%, which subtracted 0.13 percentage points from the accumulated variation.
The National Classification of Economic Activities (CNAE) indicates that the economic activities that showed the greatest increases during November 2023 were: air transport, with 5.09%; land transport and pipeline transport, with 3.92%; and accommodation activities, with 3.66%. “These activities contributed positively to the monthly variation by 0.76 percentage points,” the report highlights.
Santo Domingo
In August of last year, an investigation by the British company Online Mortgage Advisor revealed that Santo Domingo is the Latin American city where the price of housing rentals increased the most in the period 2018-2022, and the seventh in the world, when comparing the average salary that a worker must allocate to rent a house.
According to the study, in the aforementioned four years, housing rentals registered an increase of 87.9% in the Dominican capital, in relation to the average salary needed to spend on rent.
Other Caribbean cities occupy the second and third positions with the largest price differences when it comes to rent: Guatemala City, with a 68.9% increase; and the tourist destination of Cancún, Mexico, with a 36.6% increase, the report adds. Brasilia and Buenos Aires are two other Latin American capitals in the ranking as the least affordable for renting compared to 2018 rents and salaries.
The agents speak
In May, the digital El Inmobiliario consulted several real estate agents about the increase in rental prices experienced in Greater Santo Domingo. “The increase in rents isn't new; since the pandemic, it has increased exorbitantly. A rental in the million-peso area that used to be around 20,000 pesos now costs 45,000, 37,000, or 40,000,” responded Alenny Garabito, whose company, Time Homes, is dedicated to property management.
He cited the case of La Independencia, which was an area that maintained more or less reasonable prices, and "you can't find a property for less than 30,000 pesos, a one-bedroom apartment for 29,000 pesos, really very high.".
In the case of Villa Mella, along Jacobo Majluta Avenue, where prices used to range between 13,000 and 15,000 pesos, it is now difficult to find installments like that; they have risen to 22,000 pesos. Meanwhile, in the Eastern Zone, they are also surprising with prices that until now were reserved for the metropolitan area, added the real estate advisor.
Arguments
Claudia Castillo, from Plusval Dominicana, mentioned to El Inmobiliario , when consulted for the article, that a possible reason for the increase in rent was the readjustment of interest rates by banks, which led some landlords to raise their tenants' monthly rent. "That happened to me with two clients; that was their reason," she explained to El Inmobiliario.
Another argument used by landlords to justify the rent increase was the rise in the price of construction materials, "because many of the apartments are new and therefore they have set high rental prices from the start," Castillo said.
“The truth is that in the central industrial park, prices are frightening; areas on the outskirts are more manageable, but they have gone up at all levels,” said Claudia Castillo.
