Public entities prevent reactivation of real estate and investments – Nationals

In June 2020, the Government announced an auspicious reactivation plan to boost the economy after the crisis left by the pandemic, which included public investment in infrastructure, support for housing and development credit; However, it is not being used due to delays in public entities that must manage permits, guarantees, titles and others.

Although the Executive promoted the reduction of credit rates for AFD homes, and the conditions to facilitate access and approval of loans were made more flexible, the procedures in the Directorate of Public Registries that depends on the Judicial Power and the Directorate of Cadastre that depends on the Treasury are generating a wave of criticism of the plan proposed by the Executive Power to boost the economy, which reveals the untidiness among the state entities themselves.

According to a survey carried out by our newspaper, the guarantees that have the most delays are those that require the approval of cadastral plans. Dimas Ayala, manager of the Bank for Commercialization and Production (Bancop), commented that the entity has some cases pending, even from 2019. He indicated that in Public Records most of the cases have a delay of 2 months, or more.

He added that a mortgage without problems takes an average of 90 days and those that require plans or other issues can reach 180 days and 360 days. Only this entity has guarantees that are in process for almost G. 40 billion for credits approved in guaraníes and US $ 13 million of loans, of operations in dollars.

For his part, José Brítez, CEO of Banco Itaú, indicated that the mortgage loan is an extremely relevant product in the entity and that they are concerned about the delays that have been occurring, since this holds back the dynamics of the economy, which since The private sector can be boosted with the financing of housing, construction and everything that follows, such as services, employment, etc.

The executive acknowledged that due to the pandemic there is a significant delay in disbursements of mortgage loans due to the fact that public offices are working in crews and that has its impact. For example, he indicated that the domain certificate issuance is even dated after it has expired “

As detailed, Banco Itaú has loans for homes, approved and pending disbursement for around G. 50,000 million. “It is a lot of money for people who are waiting for the loan and that we cannot disburse because the certificates do not come out or it is pending in some part of the public sector”, explained the executive. He urged to see the mechanisms to improve this management and take advantage of the good market conditions, because it really is something that can boost the economy.

In turn, the economist César Barreto and also a director of Banco Familiar pointed out that the disbursements of the loans that are pending due to the management of the registry is critical. He added that domain certificates, which are a vital part of the process, are taking between 60 and 70 days, a process that before the pandemic took around 20 days. “This practically interrupts the process of granting loans and real estate purchase and sale operations take time to materialize with the economic and financial costs that it entails for participants in the real estate business,” said Barreto.

He recommended that for this case it would be important to review the protocols and processes to regain agility in the corresponding records. Since these delays are attributed to work in crews since the beginning of the Pandemic.

Beltrán Macchi, director of Vision Banco and vice president of the Association of Banks (Asoban), also referred to the issue and indicated that these cumbersome delays, both in Castro and in the Public Registry, are very costly for citizens.

He added that this situation today becomes one of the most important obstacles to disburse financing with mortgages or property sales, with which the investments of the private sector in general are, in the best of cases, delayed.

He added that the Association of Banks has been constantly talking about this situation, both with the Treasury authorities and the Court, in order to explore possibilities of collaboration to improve processes. He mentioned that there is a technological development project to improve the cadastre service through MITIC, but it will still take time. “Therefore, it is desirable that the authorities adopt emergency intermediate measures to remedy the inconveniences,” he said.

Growth engine

Regarding the construction segment, it stands out that it was one of the mainstays in the economy in 2020, one of the few that continued to grow, closing 2020 with an expansion of 10% and it is also expected that this year it can advance around 5 %, according to official estimates of the Central Bank of Paraguay (BCP).

Housing portfolio and disbursements

According to data from the Superintendency of Banks (SIB), at the end of last December, banking entities accumulated a balance of G. 3.6 trillion (US $ 586 million) in loans for housing, which meant an increase of 10% compared to 2019; These data include AFD’s mortgage loans and those granted with equity and refinancing. As for the funds granted by the AFD in 2020, they added only US $ 56 million for new loans, which represented a drop of 26% compared to 2019, due to the delays mentioned in the public negotiations.

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