In an environment of high inflation with increases in the interest rate of the Bank of Mexico (Banxico) , Infonavit expects not to increase the costs of its financing that it charges its borrowers between now and the end of the six-year term, 2024, its general director advanced. Carlos Martinez.
The institute will continue to charge progressive interest rates, depending on the income of the workers, between 1.9% and 10.45%.
After participating in the forum Well-being before business at Expansión Summit 2022, the director of the National Institute of the Workers’ Housing Fund spoke with Expansión.
Infonavit in 2022
This year, what can Infonavit boast?
This year the credit for land was launched, a demand of workers for many years, which allows them to acquire a piece of land and start building a heritage as they want, where they want and to their liking. It is a matter of thinking about housing as something progressive.
The other issue is that we opened, universally for those who already had a loan, the possibility of converting it into pesos, one of the most ambitious programs we have launched, because it means that 2.4 million people can transform their credit, their reality financial.
What will happen to interest rates?
On average, Infonavit lends at a rate of 8%, which is more or less where most of the workers who contribute and take out a loan find themselves. This means that we are more attractive than almost any banking option.
Not increasing the interest rate will allow more Mexicans to say ‘it doesn’t matter that there is a reference rate from the central bank’ or that this puts pressure on interest rates in the financial sector: Infonavit, as a labor benefit, is not going to raise its rates and , then, you have the opportunity to buy a home.
How has the past due portfolio behaved?
From a context in which 51% of the institute’s portfolio are credits in minimum wages. What does that mean? That the balances that are shown, like the delinquency rate, at the balance level, is, I would say, inflated because it is in real terms. For years it has been indexed to inflation and an interest rate is applied to those balances. This index does not reflect the behavior of people, but has an arithmetic growth simply due to inflation.
Only 13% of people who have a loan with Infonavit face a payment problem at some point in their history, however, 86% have a regular payment. It would be a fiction to compare it with private banking because we serve a population that is more vulnerable than the one served by private banking.
Infonavit is linked to a social collection policy that allows, in average periods of two years, regularization and various programs.
What has the increase in formal employment translated into?
We have an increase in job creation, we have a record of job creation this year, we also have an increase in terms of the wage mass, that is, the salary with which workers contribute.
There is an issue between supply and demand in which workers have authorized credit, but there is nothing to buy. This has to do with a supply issue that is related, for example, to the cost of inputs.
We have seen that there is a greater demand, we have workers who have pre-approved credits, which, having higher contributions and greater density, means that their housing account has more resources to down payment. So we have to think about how supply is encouraged, given the costs and interest rates that producers face.
Have you made any progress with the developers?
From what you can do from the institute, is coordination with local, federal and other authorities, so that the waiting times for the execution of a project are as short as possible.
Collaboration with development banks or with large developers, who are vertically integrated and have their own production chain, have been able to continue developing affordable housing. The invitation is not to stop producing, given that the institute’s policy, on the demand side, is not going to change. The idea is that the industry continues and continues to produce.
How did the industry receive the new housing policy?
It was a policy that was approved in May 2021 and came into force in May 2022. They had a year of adaptation. In addition, they understand the new logic. On the business side, as a producer of housing, if there are no conditions of habitability, proximity, connectivity, transportation and mobility, capital gains will not increase. Making a development that has that means a healthy development, where future abandonment is avoided.
Each credit that is granted, evaluates that each house has, in a radius of 2.5 km around, a primary school, secondary school; a health center, a supply center, a park; primary communication routes and access to public transport. This is to translate the National Housing Policy and the elements of adequate housing of the UN to a specific credit policy with Infonavit. We hope that in the future that will mean the development standard.
How is the project to increase the maximum age for granting credits going?
We are reviewing the parameters such as: amount or the maximum age to take out the credit. Analyzes are already being done. We hope that before the end of the year we can announce it.