RIO DE JANEIRO, BRAZIL – The FipeZap Residential Rental Index, which follows the average rental price of residential properties in 25 cities in Brazil, ended December 2021 with a monthly increase of 0.80% – the sixth consecutive in the index. With the latest results, the index accumulated a high of 3.87% in the year.
Comparatively, the monthly variation of the index exceeded the consumer inflation measured by IPCA/IBGE (+0.73%) but remained below the monthly IGP-M/FGV (+0.87%). Individually, all the cities monitored by the FipeZap Index showed an increase in the value of residential rent, especially São José (+3.48%) and Joinville (+2.49%), besides São José dos Campos (+2.13%), Barueri (+2.07%), and Santo André (+2.03%).
Among the capital cities, in particular, the most significant increases in the last month were registered in Curitiba (+1.63%), Florianópolis (+1.47%), Fortaleza (+1.25%), Recife (+1.07%) and Brasília (+0.96%), while the smallest variations were observed in Goiânia (+0.21%), Belo Horizonte (+0.39%), Salvador (+0.45%), São Paulo (+0.51%), Porto Alegre (+0.59%), and Rio de Janeiro (+0.77%).
Except for São Paulo, where residential rental prices slipped 0.92% in the year on average, all the cities monitored by the index ended the period up. The highlights were São José, in Santa Catarina State, (+26.02%), Guarulhos (+18.64%), São José dos Campos (+16.38%), and Joinville (+14.69%). Considering only the capital cities, it is possible to highlight the annual increases in Curitiba (+14.17%), Florianópolis (+11.59%), Recife (+11.19%), Fortaleza (+9.55%), Belo Horizonte (+7.17%).
On the other hand, Salvador (+4.73%), Brasília (+4.42%), Goiânia (+4.01%), and Porto Alegre (+0.27%) showed less expressive variations in 2021.
PRICE
According to the survey, the average rental price ended the month of December at R$31.51/m² (US$5.69/m²). São Paulo presented the highest average rental price in the last period (R$39.76/m²), followed by the values registered in Recife (R$35.21/m²), Brasília (R$33.76/m²), and Rio de Janeiro (R$32.16/m²). Among the monitored capital cities with the lowest residential rents are: Fortaleza (R$19.03/m²), Goiânia (R$19.57/m²), Curitiba (R$23.71/m²) and Porto Alegre (R$24.94/m²).
The ratio between the average rental price and the average sale price of the properties is a measure of profitability for the investor who chooses to acquire the property to obtain rental income. The indicator can be used to assess the real estate market’s attractiveness relative to investment alternatives at each point in time.
Since mid-2020, the average residential rental return has retreated marginally, ending December 2021 at 4.66% per year – a rate recently surpassed by the projected average return for benchmark financial investments.