Posted by: davidgarnerconsulting | September 14, 2009

Brazil’s Housing Shortage

Brazil’s Housing Shortage

By David Garner – Managing Partner, David Garner Consulting

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After the re-election of President Lula in 2002, Brazil’s government introduced a “growth-acceleration package”, a set of reforms including US$236 billion worth of housing and infrastructure investments to b put in place over the next four years. Despite the global economic crisis, the Brazilian government is still continuing to address the housing shortage in Brazil, estimated to be a shortfall of some 7.5 million houses.

Around 162 million Brazilians live in urban areas, equating to around 83% of the population. Sao Paolo’s metropolitan area has a population of more than 27 million, and in of Rio De Janeiro (state), there are more than 15 million residents.

CLICK HERE to Download your FREE GUIDE to property in Brazil

 It is estimated that about one-third of Rio’s population lives in favelas – self constructed squatter towns on the outskirts of the city. In  Sao Paolo; perhaps 40% of the cities’ population lives in these squatter settlements.

Home ownership is very high at 75%, and only about 14% of the 42 million properties are rented. Leaving a large space in the market for landlords. Around 85% of all homeowners live in low quality, self-built, single-room housing units, again indicating a fantastic opportunity, as demand for better quality housing in the super economic sector is huge as wages increase (the national minimum wage has increased by more than 50%) and more people exit poverty. In 2008 6 million Brazilian left poverty.

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