Colombia | Behind the Scaffold: The Structure of the Construction Sector in Colombia

Presenting the construction supply and demand structure with a special section on urban design. In the supply section: GDP, employment, firms, and sector composition. In the demand section: logistics, housing, household composition, demographic trends, housing deficit, among others.

Key points

• Key points:
• This presentation coincides with our annual Real Estate Outlook report (February 2024), featuring recent performance in the housing sector (volume, prices, and financing), non-residential sector, and existing homes. Download the report on our website www.bbvaresearch.com.
• The construction sector contributes 4.3% to the GDP, generating 1.6 million direct jobs and requiring inputs from 36 other sectors. There are 7,388 construction firms, with 39% engaged in residential activities, primarily structured as SAS.
• In housing, larger companies are gaining market share. While the top ten construction firms accounted for 33% of new home sales in 2020, by 2023, they captured 40%. Market concentration is higher in the VIS segment.
• Colombia faces significant demands for logistics and social infrastructure that could expand the housing market. Growth in non-capital municipalities, increased resident income, and public incentives like subsidies for distant areas make construction in less explored sites with greater housing deficits attractive.
• Household composition and Colombia's demographic structure are evolving. Average household size is decreasing, the population is aging, and life expectancy is progressively rising. This aligns with recent increases in foreign remittances and higher household savings in 2023, presenting opportunities in the changing landscape.

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