Housing prices in Brasilia have been rising since 2008 at a record rate. Before 2008, most homes were bought with cash. Since 2008, Brazilians have been able to obtain mortgages for homes, increasing the home buying market for Brazil’s new middle class. National events that were and will be hosted in Brazil such as the FIFA Cup in 2014 and the Olympics in 2016 have further pushed the housing market upward. Many investors, however, have bought residential property as an investment to rent out. Brazil allows leases up to 30 months at a time since it makes use of a large number of seasonal and foreign workers who will go home in the end. Rents in the downtown area can be twice or more what it costs to buy the property.
Brasilia is the capital city of Brazil and is has an inflation rate of about 7% a year. This is down from the last few years due to government programs to reign in the cost of living. This has not happened without considerable unrest and strife, with the current president of Brazil being one of the least popular leaders in the history of the country.
From 2008 to 2014, real estate prices in Brazil continued to rise every year. The average rise was about 14%, and some years the cost went as high as 38%. However, in 2014 and the first quarter of this year, the market seems to be slowing down just a bit with growth levels at around 7% in Brasilia. Still, the real estate market is growing with one and two-room properties leading the way, especially in the center of Brasilia. The average cost of property in Brasilia is always changing, making it hard for workers to save up their money to purchase real estate. The high rent market in Brasilia is also a driving force against saving in the real estate market in Brasilia.
A contributing factor to the current slow down is the interest many prominent Brazilians have to invest in the Miami area. In Miami, a comfortable condominium can be purchased for under $250,000 in US dollars. A monthly mortgage on these homes is under $2,000 in US dollars. In Brasilia, such condos are priced at around 6,000 Rial or about $3,000 in US dollars per month, a much better deal. As more and more Brazilians move to Miami, a vibrant culture Brazilian culture is being built in the Miami area.
In Brazil, there are still problems that are making native Brazilians uneasy. The government and workers continue to have issues and strikes due to new government programs. The upcoming Olympics in the capital are starting to impact traffic and activities of daily living. Five hours waits during commute times are not uncommon. There is some question about how stable the Brazilian Rial is due to inflation which continues at around 6 percent a year. Plus, Brazilians have always felt real estate is a safe place to put money for the future. Many residents are having to live quite a distance from where they work, and fear losing their money if inflation continues to worsen. One source Brazilians use to find Miami real estate is Prestige International
Despite the slow down in real estate prices in Brasilia, Miami continues to be a strong option for Brazil buyers. One thing is sure, real estate will continue to be the primary investment option for Brasilia citizens. There are no signs of the real estate market slowing down any time soon.