New Brazilian president set to continue with reforms and incentives for growing real estate market
|Wednesday, 10 November 2010|
The election of Dilma Rousseff as the first female president of Brazil has been widely welcomed by the country’s growing real estate market.
Industry professionals believe that she will push on with reforms and incentives when she takes office in January 2011 which will see the Brazilian property market continue to prosper.
‘With the election of Rousseff, the Brazilian property market has at least another ten years of growth. The Workers Party government was the best thing that could have happened in the history of construction in the country since it was the only ruling party that has created real incentives for the industry,’ said Flavio Cabrera of Lopes Real Estate Consultants, in Porto Alegre and Rio Grande do Sul.
Major programmes such as Minha Casa, Minha Vida, ‘My House, My Life’, as well as other infrastructural programmes such as the Programa de Aceleração do Crescimento, ‘Programme of Accelerated Growth’ are aimed at encouraging home ownership. ‘It is certain that the scope of these programmes will continue to grow and assist the real estate market in a major way,’ added Cabrera.
A positive sign was that the real estate market remained strong throughout the election build up which doesn’t usually happen, according to Tânia Amorim of the Tânia Amorim Real Estate Consultancy in São Paulo.
‘We specialise in commercial and industrial real estate and we have been finding that, in 2010, there are more buyers than sellers which is due to the fact that São Paulo is the biggest economic city of a country that is witnessing rapid growth, hence the increased demand. Our quarter three sales statistics are 42% higher than that of the same period in 2009, a trend which we expect to continue,’ she added.
Samantha Gore, sales manager for Brazil estate agents uv10 pointed out that serious overseas property investors are always concerned about the health of a nation, both politically and economically, and a general election can be a turning point for better or worse.
‘Truthfully, the best outcome for Brazil would have been the re-election of da Silva. The charismatic President had an all time high job approval rate of 83% in October thanks to record low unemployment and a booming economy. However, according to Brazil’s Constitution, da Silva was ineligible having reached his limit of two successive four year terms in office. Rousseff is the next best alternative. As da Silva’s former Chief of Staff and his self anointed successor, she is unlikely to divert from current government policy,’ she explained.
‘Certainly things could not be rosier for Brazil in 2010. Recent social policies such as Minha Casa Minha Vida, the low income housing scheme, and Bolsa Familiar, the anti-poverty scheme, have helped pull 20 million Brazilians out of poverty and shifted another 29 million into a rapidly growing middle class. Meanwhile Brazil’s GDP is outperforming the predictions of the global experts surging by 9% year on year, its fastest growth rate in around 14 years,’ she added.
Indeed, the arrival of Dilma Rousseff is unlikely to cause any major changes in the growth trajectory of the housing market, according to Ruban Selvanayagam, of the Brazil Real Estate & Land Investment Guide.
But even if Rousseff didn’t get elected growth would not have stopped, according to Roberto Pimenta of Patrimovel Real Estate in Rio de Janeiro. ‘I don’t think there is one person that is not confident about the housing market here in Rio. Credit is easier to obtain, prices are still reasonable and our local economy is looking its strongest in a long time particularly as we look forward to the World Cup, Olympic Games and several other international events. Supply does also remain a major issue still and therefore there is still much room for the market to rise,’ he explained.
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