Real Estate Outlook second semester 2025

Summary

Construction GDP contracted by 1.1% in the first half of 2025, driven by a 24.6% decline in Civil Works. The mortgage market shrank by 9.2% , affected by a weak labor market and rising housing prices.

Key points

• Key points:
• he construction sector contracted by 1.1% of GDP as of Q2 2025, mainly due to a 12.6% real reduction in public works spending, although private building activity grew 4.9%, marking 11 consecutive quarters of expansion.
• The mortgage market contracted 9% in number of loans and 4.5% in total amount, while housing prices appreciated by more than 8%
• High concentration in metropolitan areas, which account for 52% of new mortgage loans.
• The potential housing demand amounts to 7.5 million units, mainly in the traditional segment (41.6%) and the social interest segment (35.2%), reflecting that it mainly comes from low- and middle-income households.
• Between 2016 and 2025, 8.7 trillion pesos were allocated to public works, mostly concentrated in energy infrastructure. Investment in transportation showed a positive correlation with construction activity.

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