Real estate financing in Brazil has gotten more expensive since January and now the market is beginning to feel the effects of the credit crunch. The rate increases, according to some market professionals, ranging from 10% to 24% for those seeking properties in the range up to R$ 650,000. Banks are also more discerning, demanding greater proof of income, when by the end of 2014 releases were faster.
According to Veja magazine, what was unimaginable five years ago happened: property prices are falling. Newly released apartments can reach the end of this year worth up to 3% less worth now, according to an analysis of the JPMorgan consulting. The wave of devaluation will also impact old properties.
There is a huge stock of new units in the hands of the real estate market. Stock are the units that have not been sold three years after the launch. In São Paulo, the annual report released this week by Secovi showed that the region has the largest inventory since the start of the series in 2004.
The winds have changed in the property market in Brazil and what is bad or good for Brazilians is also good for foreigners that want to buy in Brazil. After the 2010 boom, the increase in property prices in the city of São Paulo for example had become routine, and the value of the more than tripled square meter in some regions, a sharp update values that had been dammed. Since the middle of last year, however, the scenario is different.
With the dollar up against the Brazilian real at 3.00 R$, every single dollar you send into the country triples. As long as you don’t rush and make the right choices, 2015 could be the year to make that good investment in the country.
I haven’t been there in a while but I heard that at some famous gringo property hotspots in the northeast nothing sells for a while now. Most of these investment tourism place have changed into bigger towns with all the problems of the bigger cities of Brazil: violence, bad traffic and trash.