After the COVID-19 pandemic, land use has changed dramatically around the globe. Formerly high-priced apartments near jobs and entertainment now find themselves without a reason for their prices, as even their touted amenities are not open for months. As corporations switch to work-from-home policies, offices go unused. On the demand side, there is another crisis: as millions of people were left without work for months, they found themselves unable to pay the rent or mortgage. Because of this, governments have had to make major policy adjustments to deal with the crisis, to prevent huge numbers of evictions this year. South America was hit particularly hard by the pandemic, and governments across the continent have had vastly different responses to the mortgage-related fallout of the pandemic, lockdown, and associated economic problems.
In Chile, the pandemic has also been bad, though not as bad as in either Peru or Argentina. Like their neighbor, they have postponed all mortgage payments. However, they have not frozen rents, and they have sponsored various loans, including mortgage loans, as well as subsidizing rental property.
Colombia’s primary policy to continue supporting the mortgage market is through subsidized loans, rather like in Chile.Colombia has subsidized 100,000 mortgage loans through 2022. The houses must be worth less than 500 times the minimum monthly wage of the nearest major city, and those who receive the subsidized loans will receive the equivalent of up to 42 times the minimum wage, or $36 million Colombian pesos, through subsidies of up to $439,000 pesos per month.
Argentina currently has the highest COVID-19 positive rate in the world, and already struggled with a sluggish economy even before the events of this year. Accordingly, the government has had to take drastic measures simply to keep anything functioning. a massive relief package was passed which gave over $1 billion USD in large grants and loans. All foreclosures were suspended at the end of March, all rents were frozen at the beginning of April, and the government extended the complete mortgage freeze until January 31st, 2021. Argentina has taken the most drastic measures out of any country in South America I have observed so far, and its policies have major effects for anyone who wishes to do business in that area, especially in the mortgage industry.
To conclude, governments across South America have played a major role over the past ten months in dealing with the mortgage and eviction crisis in their countries.