Price of property in Brazil expected to rise by up to 10% in 2012

 

 

A new poll of property industry and real estate experts has predicted that property prices in Brazil should rise by between 5-10% in 2012, allowing the Brazilian real estate sector to avoid the bubble scenario recently experienced by markets such as Dubai. 

 

The poll from Reuters included experts from 15 banks, research groups and business associations, is the latest in a number of positive news releases regarding the Brazilian property market. The poll demonstrated that there was little risk of a downturn in the Brazilian property market at present, as the recent credit boom in Brazil was underpinned by strong increases in wages and affordability conditions. 

 

As with many of the recent reports on the Brazilian real estate sector, the poll focused on the demand from the rapidaly expanding Brazilian middle classes, which were now looking for opportunities to purchase property as against long term rental. This shift away from renting property in Brazil, towards full ownership has placed increasing upwards pressure on the price of property in Brazil, in a trend which looks set to continue for the foreseeable future. 

 

‘There are structural factors in place to justify such a strong performance. A sharp fall in prices in 2012 is very unlikely,’ said Paulo Cesar das Neves, analyst for the local research firm LCA.

 

Whilst Brazilian GDP has slowed considerably over the past six months as a result of decreased global demand, the Brazilian property market still seems somewhat protected by it's considerable internal demand for property.