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The private construction sector in Argentina is experiencing a gradual recovery after a sharp decline at the end of 2023. However, this recovery has particular characteristics: Heterogeneity: Not all construction segments are recovering at the same pace. Some materials, such as asphalt and plasterboard, are showing a strong rebound, while others, such as granite tiles and sanitary ware, are still showing declines. Graduality: The recovery is slow and taking place in a staggered manner. Although an overall improvement is observed, the sector is still below pre-crisis levels. Influence of the real estate market: The recovery of the sector is closely linked to the revival of the real estate market and the availability of mortgage financing. Competition between new and used homes, as well as the fall in purchasing power, influence construction demand. Impact of economic policy: Changes in economic policy at the end of 2023 generated a sharp contraction in the sector, and the effects of these changes are still being felt. Factors driving the recovery: Increased shipments of inputs: Most construction inputs show an increase in their shipments, indicating greater activity in the sector. Employment growth: The number of formal jobs in construction has increased in recent months, reflecting a gradual recovery in activity. Recovery of the real estate market: The increase in housing supply and the availability of mortgage financing are driving demand for construction. Pending challenges: Uneven recovery: Not all construction segments are recovering at the same pace, which is creating imbalances in the sector. Falling prices: Strong competition in the real estate market and falling purchasing power are putting downward pressure on construction prices. Economic uncertainty: Persistent inflation and economic uncertainty may slow down the sectors recovery. In conclusion, private construction in Argentina is showing signs of recovery, but this is gradual and heterogeneous. The reactivation of the real estate market and the increase in employment are positive signs, but there are still challenges to overcome to consolidate this trend. |
