As of 2015, Brazil has a 7 million housing deficit. The great demand for housing in Brazil has been fuelled by an ever expanding home mortgage industry. In the past five years, the economy of Brazil has been on the rise leading to high levels of employment, rising per capita income, declining interest rates, and low inflation. Access to credit, especially for the Brazilian citizens willing to buy homes, is now readily available. The positive macroeconomics trend and the ever increasing middle income class present a huge opportunity for companies that would like to invest in the real estate market in Brazil.
Long-Term Real Estate Growth Potential
According to Equityinternational.com, mortgage lending in Brazil stands at a mere 3% of GDP as compared to about 70% in the U.S. The appetite for homes among the Brazilians and the existing gap for mortgage lending are ideal opportunities for foreign companies wishing to catch in on the lucrative real estate market. The investment window could come as a joint venture with the Brazilian companies that understand the local real estate terrain all too well.
The Leading Operators in Brazilian Real Estate
Presently, several real estate and finance companies, such as Cabral Garcia Empreendimentos are the leading mortgage providers in Brazil. Cabral Garcia Empreendimentos is currently into innovative real estate financing, developing high-value home complexes, and providing mortgages to both corporate entities and individuals.
As one of the leading real estate developers and A-rated contractor in Brazil, that just launched a major website, Cabral Garcia Empreendimentos has several investments to its name including the picturesque High Caxias Residential Club, Townhouses Hotel Lapa, and the high rise Village Park Itanhangá. Founded in 2005, Cabral Garcia Empreendimentos is a leading builder and manager of its own assets in several Brazilian cities including Rio de Janeiro. One of the company’s high quality projects, the Townhouses Hotel Lapa, brought incredible returns after the property was sold in just four hours on its release.
Foreign Interest in Brazilian Real Estate
Brazilian law allows foreign citizens to acquire urban property. Thebrazilbusiness.com reports that hundreds of thousands of foreigners have bought property in Brazil over the last ten years. The majority of foreign real estate buyers are concentrated in the South-East and the North- East of Brazil. The two regions provide beautiful landscapes and real estate prices much lower than what is offered in Europe and North America. The foreigners that have bought real estate in the South-East of Brazil have seen a massive increase of their investments in the last ten years.
Brazilian cities, such as Sao Paulo and Rio de Janeiro are still the most attractive and most stable real estate investment destinations worldwide. Brazil has the reputation of providing secure and safe property registration mechanisms.