Brazil Investment Property

Brazil investment property market assessment:

Brazil’s housing market is now showing signs of improvement, buoyed by rising property demand and supply. In November 2022, Brazil’s FIPEZAP house price index rose by 6.34% from a year earlier, up from y-o-y increases of 5.29% in 2021, 3.67% in 2020, and zero growth in 2019, according to figures released by Fundação Instituto de Pesquisas Econômicas (FIPE). The past two months had been its biggest y-o-y price growth since December 2014.

However when adjusted for inflation, nationwide house prices rose by a meager 0.42% over the same period.

The national figure in fact conceals large variations in local house price movements. During the year to November 2022:

In São Paulo, house prices rose by an average of 5.19%, the biggest y-o-y rise in more than seven years. However when adjusted for inflation, prices actually declined slightly by 0.68%.
In Rio de Janeiro, house prices rose by a modest 2.33% but actually fell by 3.37% in real terms. Yet it is important to note that the city’s y-o-y house price growth has never exceeded 3% since early-2015.
In Brasilia, house prices rose by a modest 2.38%, but actually declined by 3.32% when adjusted for inflation. It was a sharp deceleration from y-o-y increases of 8.66% in November 2021 and 9.05% in November 2020.

There is also a renewed interest by foreign investors on Brazilian real properties recently, which is expected to boost the housing market further in 2023. Foreign individuals and nonresidents may invest in urban and rural properties in Brazil through direct ownership from abroad, or through resident companies or partnerships. To be able to buy a property, a tax registration number from the Cadastro de Pessoa Fisica (CPF) is required.