Brazil Property Construction Delays Resulting in Higher Levels of Judicial Action
A recent report in Brazil´s Globo newspaper pointed to increasing occurrences of delays happening on the delivery of real estate projects – interviewing a number of home buyers affected in one of the most prominent regions of the country, São Paulo.
One consumer interviewed spoke of works started on a development in the Mauá region due in October 2010 remaining in the mid-mounted stage. The company responsible for the project Tenda, stated to both Gleice dos Santos Carvalho, purchaser of the off plan property, and the Globo newspaper that the delays were due to ‘factors outside of their control.’ Another buyer the newspaper spoke to has been waiting since April 2010 and Miranda Martins, a buyer from São Paulo – whilst receiving her keys in February of this year despite being due in the second quarter of 2010 – saw that all of the units were without any form of energy supply.
According to the construction companies spoken to by the newspaper, the problems have arisen as a result of markets rising so rapidly without the sector having the capacity to handle the massive demand – in turn, the appearance of delays, a lack of material and short labour supply has become more commonplace.
Subsequently, the number of complaints with regards to delays to the Justice Tribunal of São Paulo have increased by over 400 percent, according to Marcelo Tapai of the Tapai law firm: ‘companies do not consider the fact that behind each property purchase is the story of a family with buyers being seen as solely a statistic. Contracts are made unilaterally and provide recourse to the buyer only in the case of default.’
The newspaper spoke to some of the developers and related parties in question, including Tenda who stated: ‘the delay in delivering the Ipê Life in Mauá (São Paulo) project was due to factors such as the period of above average rainfall and shortages of manpower. Tenda has already readjusted our timetables and reports that the delivery will take place in January 2012. The company will comply with the terms of the contract with its customers regarding fines for delay in delivery and makes itself available for any clarifications.’
