The northern city of Monterrey, Nuevo León may require an additional 500,000 homes within the next decade to meet the growing demand fueled by the nearshoring boom in the border state, experts predict.
Mexico is currently proving a popular destination for companies seeking to move manufacturing operations closer to the United States and away from China, a process known as nearshoring. As the trend grows, particularly in Nuevo León, so does the number of residents in major cities.
“There is a very large need for housing in Nuevo León of around 500,000 homes in the next 10 years,” Vice President of the International Investment Council (IDEI) Jorge Martínez Páez said in a press conference at the launch of IDEI’s super green bond on the Mexican Stock Exchange.
Páez warned that companies may think twice about relocating to Mexico if there is a shortage of housing options available to employees. Moreover, he said that the real estate industry in Nuevo Leon only has enough housing stock to meet demand for the next two years. “This means that if construction of new homes was to end now, the available inventory could be absorbed in 24 months,” he said.
According to Alberto de la Garza Evia, Executive President of IDEI’s board of directors, 500,000 people outside the state of Nuevo León have moved to Monterrey in the last eight years in pursuit of “the Monterrey dream.” He added that “there are more than 60 companies settling in Nuevo León to manufacture goods that countries like Mexico, the United States, and Europe and Asia need.”
Garza also said that Nuevo Leon’s government is commencing infrastructure work to supply Monterrey with enough water and power to ensure growth in the next 50 years. The city has faced chronic water shortages, which led to a state of emergency due to severe drought in February 2022.
Additionally, the state government has also invested more than $560 million pesos (US $33 million) in various infrastructure projects designed to improve mobility in the city, property listing platform Propiedades.com said in a statement.
“Monterrey offers several advantages compared to other cities in the country,” real estate analyst Leonardo González said. “This isn’t only because of mobility, but also because of nearshoring, which has contributed to a greater demand for houses and apartments.”