North East Brazil Construction Costs Sees Highest Rise in November
Brazil’s government administered construction cost index (Índice Nacional da Construção Civil, SINAPI) has seen a 0.37 percent average rise in the month leading up to November 2011 – representing a 5.52 increase over the 12 previous months.
The average national cost of construction reached R$ 808.65 per m² – estimated at R$ 445.35 per m² for materials and R$ 363.30 per m² for labour. The largest regional rise was seen in the North East – due to the rising pressures being made on salary levels in Rio Grande do Norte and Pernambuco states. To quote some regional differentials: the average cost in the South East was R$ 842.07 per m², R$ 818.95 in the North, R$ 812.09 per m² in the Centre West, R$ 802.26 per m² in the South and R$ 766.62 per m² in the North East.
It should also be noted that the SINAPI measurement excludes a number of core additional costs involved in Brazilian real estate construction, namely: land, administration of works project execution, licenses, ´habite-se´ (home lending pre-evaluation approvals), certifications, insurance costs, utilities, equipment / tools and sales taxes which collectively add a minimum of approximately 33 percent to project valuations.
