The ABA highlighted the impact of bank credit on the reduction
Taken from Diario Libre
According to the Dominican Republic's Multiple Banking Association (ABA), between 2002 and 2017, the housing deficit decreased from 1.4 million homes (65% of the total) to 829,000 (26% of the total), a reduction of approximately 589,000 homes. The ABA emphasized that, during that period, more than half a million Dominican households gained access to quality housing.
“In this context, multiple banks have made a decisive contribution to this process of reducing the housing deficit, which is reflected in the increased share of mortgage loans in the total portfolio, doubling in fifteen years,” the ABA stated, through an analysis by the entity's Economic Studies Department.
In a press release, the ABA reported that, in the last fifteen years, credit for the acquisition of homes (mortgage) or for the remodeling of the same, went from RD$11,830.19 million to RD$156,826.42 million.
He specified that the figure represents an accumulated increase of 1,226% (RD$ 144,996.23 million), which in annual terms is equivalent to an average growth of 18.8% (RD$ 9,666.42 million).
The association representing multiple banks stated that these results are above the overall loan portfolio, which grew at an average annual rate of 13.7% during the same period. It highlighted that, thanks to this growth, mortgage and home improvement loans increased from 7% in 2006 to 14% in 2021.
Likewise, in terms of the number of loans granted, the total number of mortgage loans and loans for home improvement purposes increased from 11,061 in 2006 to 70,290 in 2021, for a growth of 59,229 loans (535%), which in annual terms is equivalent to a growth of 3,949 loans per year (13.1%), the ABA stated in a press release.
He explained that the interest rate has been reduced by 708 basis points since 2006, while at the same time, it is becoming more common to see longer terms in this type of credit from the multiple banks that operate in the country.
The ABA indicated that, while it is true that the Dominican Republic has made great progress in reducing the housing deficit, the country still needs approximately 382,000 new homes and another 446,000 require substantial improvements in infrastructure and basic services.
In that regard, he guaranteed that multiple banks will continue to support Dominican households in their search for solutions to their housing needs.
