Blog

Recent research undertaken by Brazil’s Exame Magazine – using data from Ibope Intelligence – has shown that the rapid growth witnessed in Brazil’s property values between 2010 and 2011 pushes the country into the lead when compared to the rest of the world.

The findings stated that in 2010 – over 1 million houses and apartments were financed, representing twice the number of 2008.  Since this period, the volume of launches undertaken by the country’s major developers has doubled and a new development in one of Brazil’s main cities was taking an average of 4 months on average to completely sell (three times faster than what was witnessed in 2008).  Mean prices across the country between April 2010 and April 2011 were reported to have risen by 24.7 percent, putting it in front of Hong Kong, Latvia and Singapore as shown in the graph below:

A breakdown of prices was also highlighted of some of the most notable state capitals, between April 2010 and April 2011 which we have outlined below.  However it should be noted that the following is based on asking (advertised) prices and not real time sales prices (which, as yet, there is no measurement index).  Readers should also be aware that the statistics provided refer to the most prominent regions of each city and not as a whole.

São Paulo:

Seeing the highest pattern of growth for the regions analysed, prices for new Paulista properties have risen by 31 percent and 28 percent for second hand properties.  The following regional breakdowns were provided:

• North East Region (Freguesia do Ó, Jaraguá and Limão): Average prices for new properties = R$ 4,255 per m² (31 percent growth) / Average price for second hand properties = R$ 3,226 per m² (38 percent growth);
• North Region (Casa Verde, Santana and Tucuruvi): Average prices for new properties = R$ 4,663 per m² (31 percent growth) / Average price for second hand properties = R$ 3,669 per m² (18 percent growth);
• West Region (Barra Funda, Lapa, Perdizes and Vila Leopoldina): Average prices for new properties = R$ 6,792 per m² (38 percent growth) / Average price for second hand properties = R$ 5,110 per m² (27 percent growth);
• East Region (Itaquera, Penha and Vila Matilde): Average prices for new properties = R$ 2,992 per m² (10 percent growth) / Average price for second hand properties = R$ 2,908 per m² (19 percent growth);
• South East Region (Alto Pinheiros, Itiam, Jardim Paulista, Moema, Morumbi, Vila Mariana): Average prices for new properties = R$ 7,384 per m² (31 percent growth) / Average price for second hand properties = R$ 6,020 per m² (32 percent growth);
• Central (Bela Vista, Consolação, Liberdade and Sé): Average prices for new properties = R$ 5,717 per m² (41 percent growth) / Average price for second hand properties = R$ 5,200 per m² (39 percent growth);
• South East Region (Aricanduva, Ipiranga, Mooca and Tatuapé): Average prices for new properties = R$ 4,860 per m² (26 percent growth) / Average price for second hand properties = R$ 3,781 (24 percent growth);
• South Region (Campo Limpo, Santo Amaro and Socorro): Average prices for new properties = R$ 4,250 per m² (13 percent growth) / Average price for second hand properties = R$ 3,900 per m² (33 percent growth);
• Jardim Paulista – the most expensive region in São Paulo: Average prices for new properties = R$ 9,120 per m² (39 percent growth) / Average price for second hand properties = R$ 6,959 per m² (49 percent growth);
• Perdizes – the region which has increased in value the most in São Paulo: Average prices for new properties = R$ 8,157 per m² (57 percent growth) / Average price for second hand properties = R$ 5,414 per m² (41 percent growth).

Rio de Janeiro:

The city’s popularity as a real estate destination remains strong – particularly as a result of the limited availability of land combined with promised (albeit slower than expected) infrastructural improvements in the build up to the World Cup 2014 and the Olympics 2016.  According to the research, the region possesses the highest averages prices per metre square in the country with prices in Ipanema (south zone) reaching up to R$ 13,000 per m².

• North Zone (Bonsucesso, Galeão, Ilha do Governador, Penha and Ramos): Average prices for new properties = R$ 2,929 per m² (17 percent growth) / Average price for second hand properties = R$ 2,362 per m² (15 percent growth);
• Central (Centro, Estácio, Glória, Rio Comprido, Santa Teresa and São Cristóvão): Average price for second hand properties = R$ 3,300 per m² (34 percent growth);
• West Zone (Bangu, Campo Grande, Realengo and Santa Cruz): Average prices for new properties = R$ 2,275 per m²  / Average price for second hand properties = R$ 2,177 per m²;
• Barra (Barra da Tijuca and Recreio dos Bandeirantes): Average prices for new properties = R$ 5,135 per m² (18 percent growth) / Average price for second hand properties = R$ 5,010 per m² (10 percent growth);
• Jacarepaguá (Camorim, Cidade de Deus, Jacarepaguá, Taquara and Vargem): Average prices for new properties = R$ 3,180 per m² (23 percent growth) / Average price for second hand properties = R$ 2,728 per m² (25 percent growth);
• South Zone (Botofogo, Copacabana, Flamengo, Gávea, Ipanema, Lagoa, Leblon and Urca): Average prices for new properties = R$ 9,275 per m² (38 percent growth) / Average price for second hand properties = R$ 8,250 per m² (31 percent growth);
• Ipanema – the most expensive region in Rio de Janeiro: Average prices for new properties = R$ 13,031 per m² (36 percent growth) / Average price for second hand properties = R$ 12,134 per m² (25 percent growth);
• Flamengo – the region which has increased in value the most in Rio de Janeiro: Average prices for new properties = R$ 7,986 per m² (61 percent growth) / Average price for second hand properties = R$ 6,536 per m² (34 percent growth).

Porto Alegre:

The capital of Rio Grande do Sul state, although witnessing the lowest state population rise between 2000 and 2010, is considered strategically important for Brazil’s export growth (Uruguay and Argentina) and has also witnessed a high level of public investment.  The following regions were analysed:

• North (Anchieta and Humaitá): Average prices for new properties = R$ 3,640 per m² / Average price for second hand properties = R$ 2,218 per m² (17 percent growth);
• North East (Boa Vista, Chácara das Pedras, Jardim Europa, Petrópolis and Três Figueiras): Average prices for new properties = R$ 4,208 per m² (18 percent growth) / Average price for second hand properties = R$ 3,308 per m² (14 percent growth);
• Central (Bom Fim, Menino Deus, Moinhos de Vento, Praia de Belas): Average prices for new properties = R$ 4,500 per m² (18 percent growth) / Average price for second hand properties = R$ 2,960 per m² (11 percent growth);
• East West (Agronomia, Jardim Carvalho and Teresópolis): Average prices for new properties = R$ 3,012 per m² (19 percent growth) / Average price for second hand properties = R$ 2,296 per m² (14 percent growth);
• West (Ipanema and Tristeza): Average prices for new properties = R$ 3,096 per m² (17 percent growth) / Average price for second hand properties = R$ 2,638 per m² (19 percent growth);
• South (Belém Novo, Belém Velho and Cascata): Average prices for new properties = R$ 1,606 per m² / Average price for second hand properties = R$ 1,860 per m²;
• Moinhos de Vento: the most expensive region in Porto Alegre: Average prices for new properties = R$ 7,207 per m² (37 percent growth) / Average price for second hand properties = R$ 4,065 per m² (8 percent growth);
• Boa Vista: the region which has increased in value the most in Porto Alegre: Average prices for new properties = R$ 4,822 per m² (47 percent growth) / Average price for second hand properties = R$ 3,792 per m² (23 percent growth).

Distrito Federal:

With a population that increased from 418,000 habitants in 2000 to 2,469,000 in 2010 (according to the Brazilian Census), the city has witnessed a wide range of infrastructural improvements to support what is one of the fastest growing regions of the country.  The data provided by Ibope Intelligence did not track prices for 2010 (however readers may be interested in seeing the Brazil Real Estate & Land Investment Guide’s early 2011 analysis which refers to the region) – but, as at April 2011, according to the research, the average price for new properties in the prominent areas was R$ 5,840 per m² for new properties and R$ 4,254 per m² for second hand real estate.

• Sobradinho: Average prices for new properties = R$ 4,066 per m² / Average price for second hand properties = R$ 2,441 per m²;
• Lago Norte: Average prices for new properties = R$ 7,346 per m² / Average price for second hand properties = R$ 5,607 per m²;
• Brasília: Average prices for new properties = R$ 9,411 per m² / Average price for second hand properties = R$ 6,148 per m²;
• Asa Norte: Average prices for new properties = R$ 9,987 per m² / Average price for second hand properties = R$ 8,296 per m²;
• Taguatinga: Average prices for new properties = R$ 3,864 per m² / Average price for second hand properties = R$ 2,684 per m²;
• Cruzeiro: Average prices for new properties = R$ 10,653 per m² / Average price for second hand properties = R$ 7,766 per m²;
• Guará: Average prices for new properties = R$ 5,066 per m² / Average price for second hand properties = R$ 3,458 per m²;
• Águas Claras: Average prices for new properties = R$ 4,441 per m² / Average price for second hand properties = R$ 3,697 per m²;
• Lago Sul: Average price for second hand properties = R$ 3,374 per m²;
• Asa Sul: Average prices for new properties = R$ 11,523 per m² / Average price for second hand properties = R$ 8,302 per m².

Recife:

Another city that benefits from being well connected to the rest of Latin America in addition to being increasingly recignised as a growing industrial and technological hub.  The average price in the most prominent regions analysed reached R$ 3,754 per m² for new property and R$ 2,664 per m² for second hand.  Prices were also indicated at being R$ 10,976 per m² in the most highly valued region, Boa Viagem.

• North (Arruda, Porto da Madeira and Pau Ferro): the researchers pointed out that this area is an important region but, as yet, no statistics are available;
• Central (Aflitos, Boa Vista, Ilha do Leite, Jaqueira and Espinheiro): Average prices for new properties = R$ 3,506 per m² / Average price for second hand properties = R$ 2,826 per m²;
• Central West (Casa Amarela, Caxangá and Monteiro): Average prices for new properties = R$ 3,653 per m² / Average price for second hand properties = R$ 1,663 per m²;
• Central East (Campo Grande and Torreão): Average prices for new properties = R$ 2,738 per m² / Average price for second hand properties = R$ 1,810 per m²;
• West (Cidade Universitária, Tejipió and Váreza): Average prices for new properties = R$ 2,297 per m² / Average price for second hand properties = R$ 2,049 per m²;
• East (Afogados, Cabanga and Santa Antônio): Average prices for new properties = R$ 3,147 per m² / Average price for second hand properties = R$ 1,241 per m²;
• South East (Imbiribeira and Pina): the researchers pointed out that this area is an important region but, as yet, no statistics are available;
• Boa Viagem: Average prices for new properties = R$ 4,266 per m² / Average price for second hand properties = R$ 3,014 per m².