A total of 9.1 million families plan to buy real estate in Brazil over the next 12 months which is a huge increase since the Minha Casa Minha Vida (My House, My Life) program was introduced in 2009
A recent survey carried out by the Data Popular Institute has found that 9.1 million Brazilian families intend to buy a property in Brazil over the next year. This purchase would allow them to leave rental accommodation and become property owners.
The subsidies and benefits included in the social housing program Minha Casa Minha Vida mean that buying instead of renting is an increasingly popular option. Minha Casa Minha Vida offers reduced mortgage interest rates to qualifying families so monthly mortgage payments are invariably cheaper than rent.
The number of potential buyers of Brazilian real estate has increased dramatically since Minha Casa Minha Vida first made its appearance in 2009. Less than two years ago, 4.2 million families had serious plans to buy property, a figure that is now more than twice as high. This massive hike is due to several factors such as the increase in salaries, wider availability of credit and better education, all part of the bigger picture of a booming Brazilian economy.
Brazil has one of the world’s fastest growing middle classes and this is the social sector where demand for a home is highest. Of the 9.1 million families, Data Popular found that the majority lie within the 3 to 10 minimum salary income bracket. This sector, known as Class C, is the major engine behind consumer spending in Brazil with an ever bigger appetite for all kinds of consumer goods from health foods and flat-screen televisions to cars and real estate.
Brazilian families would, according to the survey, like to buy a house rather than an apartment and the Minha Casa Minha Vida caters for both types of property. However, lack of available land means that houses form a smaller part of the program than apartments, particularly in the large cities.
Another obstacle in the way of the 9.1 million dreams of new homes in Brazil is that the Brazilian property market is still relatively small. And, although civil construction in Brazil is booming, this huge demand is unlikely to be fulfilled in near future.