Chile Home Prices to Slow From Last Year, Paz CEO Magendzo SaysEduardo Thomson
Increases in Chilean home prices will fall short of last year’s record growth amid a tempered economic outlook, Paz Corp SA Chief Executive Officer Ariel Magendzo said in an interview.
“Economic expectations are starting to moderate, and that may make people less anxious to rush out and buy a house,” Magendzo said in an interview in his office in Santiago.
Paz, Chile’s second-largest publicly traded homebuilder, has tumbled 15 percent this year after rising 69 percent in 2012. Shares fell 4.9 percent to 290 pesos today, the biggest drop since October 2011 on a closing basis.
Home prices in Santiago rose 8.6 percent last year, matching a 2011 growth rate that was the highest on record stretching back to 2004, according to Chilean Construction Chamber. In March, annual price growth slowed to 6.5 percent, based on the chamber’s latest monthly reading.
Chile’s economy expanded by 4.1 percent in the first quarter from the year earlier, the slowest pace since the three months through September 2011. Growth is projected to average 4.9 percent in 2013 and 4.7 percent in 2014, based on the average estimate of 19 economists surveyed by Bloomberg.
The country’s economy has expanded by at least 5.5 percent in each of the past three years.