Overview
- Construction input costs climbed 126% from October 2023 to June 2025 while prices for new square meters rose just 23.9% and used units 8.7%, sharply eroding developer returns.
- In June, average construction cost per square meter reached US $2,846 for completed builds, US $2,932 for off-plan projects and US $2,211 for second-hand units.
- Sixty-nine percent of industry entrepreneurs reported year-on-year declines in activity, reflecting stalled lot and project sales under tight credit conditions.
- The government’s new divisible mortgage regulation aims to fund purchases of homes under construction and land lots, but no banks have rolled out the product.
- Experts warn that slowing peso inflation alongside a stable dollar rate will continue to push dollar-denominated building costs higher in the coming months.