: August 10, 2015
In 2013 and 2014, Ecuador’s property market slowed down, which resulted in a surplus of housing options. The drop in prices succeeded in attracting homebuyers from all over.
Let’s check in on Ecuador’s economy to see how it impacts the real estate market.
A growing economy
Ecuador’s property market might have cooled down following a 5-year boom, but the economy continues to grow, thanks to remittances, imports, household consumption, investment, and, to some extent, the country’s own oil sector.
Last year, Ecuador recorded one of its highest growth rates – 3.5% in the last quarter of 2014, and 3.8% for the whole year.
Contributing to the growth were:
- Remittances from abroad at 6.2% percent year-on-year
- Investments at 3.7%
- Household consumption up by 3.9%
- The expansion of the country’s oil sector at 2.2%, and non-petroleum oil sector up by 4.3%
Compared to the past two years, last year’s growth in the oil sector is minimal, thanks to the global decline in crude oil. Nonetheless, the Ecuadorian economy managed well in 2014.
What’s in store for 2015?
Ecuador is the smallest member of the Organization of Petroleum Exporting Countries (OPEC), and relies heavily on oil and mining.
The continued global decline in crude oil may continue to affect the Ecuadorian economy, eating into gains. Still, economists believe the economy will inch forward this year at a rate of 1.9%.
According to Deloitte, 2015 might also bring an increase in the price of goods. As stated in their recently released Latin America Economic Outlook, “the forecast is for price increases of around 3.9 percent, although authorities have advised that estimates will be revised to take account of changes in the price of oil.”
An economy expected to slow down and an uptick in prices will certainly have an impact on the Ecuadorian real estate market. If you’re interested in purchasing a property, it’s best to do it now while property prices remain relatively low. To know more about your real estate options, drop us a line at torrin(at)livethelifeinecuador(dotted)com.