Tag Archive | "Brazil"

Brazil’s Housing Market Could See Possible Trouble Ahead

From the surface, Brazil’s residential real estate market is currently one of the strongest in the world. The nation’s middle class is enjoying an upgrade in lifestyle, and property values have soared over the past ten years. In fact, the major city of Rio rivals New York and Paris in terms of affordability and availability of rental properties.

Many of the properties available in Rio’s most popular and well-known neighborhoods are impressively expensive. The price of a basic apartment with little to no view costs as much in Brazil’s elite neighborhoods as it does in the prime sectors of New York, London, and Paris.

Many of those living in the prime neighborhoods of Rio are international visitors. Executives from the biggest industries, including oil, cosmetics, and banks all own property in the area along the beach of the ocean.

While one might think that only the premier areas of Rio would be unattainable. However, rental prices have become so exorbitantly high that they are grossly unaffordable for many citizens. Even properties with bedrooms too small for beds are commanding obscene prices.

The market as a whole is booming unlike anyone has even seen in the past. However, economists are starting to question whether or not the growth is sustainable. Some believe that Brazil may face a crash that is similar to or worse than that experienced by the United States five to six years ago. Many believe that the market will not stand the test of time, and may plummet following the 2016 Olympics.

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Brazil Property Market Expected to Remain Strong

As Brazil’s residential real estate market continues to exceed expectations, many are starting to wonder if a bubble may soon form in the growing nation. After all, other nations with rapidly growing real estate markets have enacted multiple measures to prevent a crippling bubble like those seen in the United States, Dubai, Spain, and Ireland.

 

Economists, though, continue to be very positive about the long-term success of Brazil’s residential real estate market, and have dismissed any thought of the formation and subsequent bursting of a property market bubble. Although the Brazilian market won’t be able to sustain its double-digit growth over the long-term, many believe that the market will, at the very least, continue growing at a more moderate pace.

 

One of the biggest differences between the Brazilian residential real estate market and others around the world is that the majority of those buying homes in the Brazilian market are doing so to actually live in them. There have been very few, if any, homes purchased for speculation purposes.

 

In addition to that point, it should be noted that, despite incredible growth over the past few years, the Brazilian market is still relatively small. Only a very small percentage of the nation’s GDP is made up of outstanding loans, and banks have not yet made it possible for non-residents to secure any kind of mortgage financing. As such, the market is still very much controlled.

 

While countries such as the United States struggle to keep its middle class intact, Brazil has seen its middle class grow exponentially. It is for that reason, as well, that many expect the nation’s property market to continue its strong performance.

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Brazilian Residential Property Market Expected to Increase in 2012

Many analysts are predicting that Brazil’s residential real estate market will experience strong gains in the next year. While the market is expected to see increases at an impressive rate, a bubble won’t likely form for at least a few years in Brazil’s residential property sector.

As Brazil’s middle class continues to experience strong growth, it is likely that many families will make the change from renting to home ownership. Over the last two years, home prices have surged at unprecedented levels. Despite the tremendous increase in prices, many potential homeowners are still expected to purchase their first home in the coming year.

Prices are expected to jump as much as ten percent throughout Brazil, where consumer confidence remains at record high levels. The anticipated growth makes Brazil one of the few nations around the world that will likely see an increase in home pricing.

There was a fear that Brazil’s uncharted growth over the last few years would result in a bit of a downturn for 2012. However, the most recent data to surface indicates that the market will continue to gain strength throughout the year. As such, some analysts have gone as far as saying that the market won’t stop gaining until the slum areas of Brazil have finally disappeared.

There are many factors that are certainly contributing to the rise of the Brazilian residential real estate market. The unemployment rate stands at a record low. In addition, many Brazilian homeowners opt to purchase homes for permanent residence, thus eliminating any such risk of rapid sell-offs of homes. Those reasons alone have helped Brazil maintain a healthy housing market.

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Brazilian Housing Market Expected to Thrive for Years

Brazilian Housing Market Expected to Thrive for Years

As its economy continues to show outstanding growth, the Brazilian real estate market is expected to post incredibly strong numbers over the next five years. Real estate analysts around the globe have identified Brazil’s housing and commercial property markets as being two of the strongest in the world.

As many investors begin to shy away from China due to the nation’s hefty restrictions on property sales, Brazil is becoming more and more attractive each day. Although the pending global economic crisis is indirectly affecting Brazil’s economy, the housing market has shown no signs of slowing down. More Brazilian citizens than ever before are looking to buy a home.

There have been a few external factors that have played a major role in the housing boost, and will likely continue doing so until 2017. The nation will be hosting the World Cup in 2014, which has thus led to the construction of housing, hotels, and new stadiums. In addition, Brazil will host the 2016 Summer Olympic Games, which is, of course, also serving as a major factor for increased demand and pricing.

Lastly, there have been a number of recent oil discoveries off the coast of Brazil, which have provided a significant boost to the long-term economy.

Ironically, homebuilders in Brazil have struggled this year. It is for that reason that Brazil should be considered one of the best places to invest in the next year or two, as prices and construction will soon increase at astronomical levels. The property market in Brazil is considered to be one of the safest and strongest investments at least until 2017 when the benefits of the World Cup and Olympic Games have subsided.

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Sao Paulo Real Estate Market Shows Strong Gains

The real estate markets of Brazil’s biggest cities continue to grow at unprecedented levels. Recent reports show that the market in Sao Paulo has jumped more than fourteen percent in the past year, and will likely continue to rise in the coming months.

Other major cities such as Rio de Janeiro and Porto Alegre also experienced gains of more than ten percent in their respective real estate markets. Both prices and sales in all three cities have risen during the last year.

There are a number of factors contributing to the growth in pricing and sales of residential properties in Brazil. The country is in the middle of an economic boom. Unemployment in the country is at a record-low level, and credit continues to become more readily available. Various government initiatives aimed at improving homeownership prospects for low-income families have also contributed to growing home sales.

Prices have risen almost eighty-five percent in some areas over the last 2 and half years. Prices show no sign of leveling off in the near future, which leads some to wonder if a bubble is rapidly forming. However, officials and homeowners alike are not overly concerned about that possibility, as the economy remains strong, and shows no signs of slowing down.

Brazil is one of a few countries that continue to thrive despite threats of a global economic crisis. The Brazilian economy has shown remarkable growth over the past few years, and as such, its residential real estate market has followed suit. Many Brazilian investors are also looking outside Brazil to invest in property, with Miami being a key target location.

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