An average of a 10% increase for the cost of housing construction has been measured in Santiago. This is a comparison between the first half of 2019 and the same period of the previous year. It is also the latest Study “Evolution of Housing Construction Costs of Greater Santiago” carried out by the area of studies of DRS Engineering and Management.
According to the document, the highest increases were recorded in the municipalities of Santiago and San Miguel, with increases close to 20%. While in Providencia and Las Condes, the increase varied between 9% and 10%.
The increases in construction costs were mainly due to a 2.7% increase in general expenses which construction companies face; they were detected in the report. This is due to the new post-sale and quality requirements demanded by real estate agencies. This includes 2.5% of termination costs, because real estate agents are considering a better standard for housing units as a way to differentiate their product.
The new laws of the Pipeline and Contract for Faena also had an increase of 1.9% on facility costs. Also, it saw an increase of 1.2% for complicated work, due to a greater endowment.
Finally, an increase of 1.6% in the costs of undercutting and excavation was detected. This was caused by the condition of available land, whose capacities are tighter.
The analysis is based on the information collected from the housing projects in which DRS has participated. Its objective is to provide guidelines on the composition and source of higher project costs.
Translated from ‘Costos de Construcción Habitacional del Gran Santiago anotan alza de 10%