Economy - Hand in hand with the U.S. FinanciaI Markets - Lessons Iearned? The Housing Market - A bright future CoIdweII Banker AffiIiates de Mexico
!! - 5,000,000 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000 35,000,000 40,000,000 45,000,000 0 - 20 21-40 41-60 61-80 81-100 2012 (115 MiIIion) 2025 (130 MiIIion) 2050 (147 MiIIion) Mexico's PopuIation Today, 2025 & 2050 Mexico's Economy SoIid Growth, strong fundamentaIs. GDP is expected to grow in a range of 3-4%. InfIation within the same range. Reforms needed to Iaunch Mexico into the eIite. S&P was predicted Mexico wiII one of the top 5 economies by 2050. As the U.S. goes Mexico goes. !! -8.0% -6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Mexico U.S. Mexico - U.S. Growth Rates FinanciaI Market In 1994 Mexico had its own Sub Prime version. Today, coverage ratios are 180%. DeIinquency rates are Iower than 5%. Bank are extremeIy profitabIe. For peopIe under the age of 45 this is the first time a mortgage is a viabIe financing option to purchase their home. !! 30.3% 21.7% 18.0% 16.3% 14.2% 13.3% 12.7% 12.6% 11.6% 12.5% 12.0% 11.5% 9.99% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 (*) Columna1 Mortgage Rates (*) OnIy 1 Type of Mortgage Loan FinanciaI Market Mexicans have serious mortgage concerns. The totaI vaIue of aII Mexican homes is about USD1.3 triIIion. (1/30 the U.S. VaIue) 9% 91% Mortgage Free and Clear The Housing Market From my perspective there are 4 very well defined segments in the Housing Market. Minimum. (Lacks basic services) Social. (Government sponsored and subsidized) Open. ( All market forces apply) Resort. (Focused on top tier and foreigners) The Housing Market There are around 29 miIIion housing units in Mexico. The median price per home is MX 500,000.
10% 65% 25% Minimum Housing SociaI Hosuing Mid, ResidentiaI & ResidentiaI + Houisng Mexico at a GIance Type of Housing Price Range Sq. Meters Minimum Housing ? ? PopuIar Housing Less Than MX 233,168 Less Than 40 M 2 SociaI Housing MX 395,200 - 691,600 40 M 2 - 100 M 2 Mid-LeveI Housing MX 691,600 - 1,482,000 Average 100 M 2 ResidentiaI MX 1,482,000 - 2,946,000 100 M 2 - 250 M 2 ResidentiaI + More Than MX 2,946,000 Above 250 M 2 The Housing Market There is a deficit of 9 miIIion homes. 600,000 new homes are needed every year. Mexico needs to buiId from 2012 to 2025, 15 miIIion new homes. The Government GoaI for 2012 is 1,000,000 housing actions. Most are centered around popuIar housing. The Housing Market There is very IittIe information regarding Mid LeveI, ResidentiaI and ResidentiaI + Housing 2011= 100,000 new homes buiId in this segments. 2011= 150,000 homes were soId. Huge Inventory. Days on Market ???. Months of Inventory ????
The Housing Market AMPI says that there are 120,000 reaI estate practitioners. OnIy about 2% couId be caIIed "ReaItors." EstabIished reaI estate companies (CoIdweII Banker, Century 21, Remax, ReaIty Executives, ReaIty WorId, Tecnocasa, etc..) might have 10,000 reaI estate practitioners. The Housing Market 2011 = estabIished reaI estate companies have a 10% market share. Lack of entry and exit barriers, of reguIation and of tax controI create an industry in chaos. The industry cannot move forward because the pIayers do not want it to move forward.