Acquired by Brazil’s second largest construction company Gafisa in 2008, the dominant low income housing developer in the country Tenda have run into difficulties in maintaining the projects on their books – with an estimated one third of the company´s entire stock under construction having difficulty in moving forward.
According to Valdecy Gusmão of the Recife (Pernambuco, North East Brazil) Official Property Registry Office, a significant proportion of real estate has not been registered correctly in the metropolitan area – with regions such as Tamareira, Casa Amarela, Casa Forte and Poço only having between 5 and 10 percent of properties listed.
The Annual Brazilian Popular Housing Meeting was held in the last week of November 2011 – bringing together activists from 20 of the 26 Brazilian states aiming to debate issues related to alleviating the country´s massive housing deficit largely effecting the low income demographic (estimated at 7.5 million and growing according to the Joâo Pinheiro Foundation).
Despite what was recently reported as a liquid profit level of R$ 752 million for 2011 (as at November), the number of legal cases being taken against PDG Realty has offset what would normally be a reason for the prominent real estate developer to celebrate.
Sector price rises gained further force in November at 0.5 percent, according to the Brazilian Index of Construction Market Costs (Índice Nacional de Custo da Construção – Mercado, INCC-M) – compared to 0.2 percent in October. Up until November, the INCC-M accumulated a total increase of 7.21 percent in 2011 and 7.84 percent over the previous 12 months.
Recent data released by the Department of Statistics and Socioeconomic Studies (Departamento Intersindical de Estatística e Estudos Socioeconômicos) has reported Brazil´s real estate construction sector has the highest turnover rate of all industry. In 2009, 86.2 percent of construction sector employees were discharged from work (excluding retirees, death or voluntary departures).
Data released by Brazil’s Cities Ministry has revealed that half of the municipalities in the state of Amazonas are not actively developing a clear low income housing strategy nor adhering to the National Social Interest Housing System (Sistema Nacional de Habitação de Interesse Social, SNHIS). With a deficit at 25.4 percent of total stock (according to the Getúlio Vargas Foundation), concerns are being voiced related to the little progress being made.
Data released by the São Paulo Housing Syndicate (SECOVI-SP) has demonstrated that rental requirements of new agreements have risen by 2.2 percent when comparing September to October – bring the total rise to 19.66 percent for the year up to this latter month. According to the organisation, this represents the largest rise within a one year period since the research started in January 2005.
A recent investigation led by the Foundation for the Development of Fortaleza Housing (Fundação de Desenvolvimento Habitacional de Fortaleza, Habitafor) has pointed to 660 buildings in the north-eastern city centre that are currently underused, 120 of which have strong potential for residential development.
Brazil´s largest home lender Caixa Econômica Federal has registered a 44.2 percent expansion over the 12 months, reaching R$ 141.2 billion. From this amount, R$ 73.4 billion were financed with resources from the national savings and R$ 67.8 the Guaranteed Fund of Service Time (Fundo de Garantia do Tempo de Serviço, FGTS).
