Brazil Residential Real Estate Sales Down for Fourth Month

By Nelson Belen, Contributing Reporter

RIO DE JANEIRO, BRAZIL – According to the latest FipeZAP Index, which tracks residential real estate sale prices in Brazil’s twenty biggest cities, prices remained relatively stable in June, registering a marginal decline of -0.15 percent compared to May.

The slight decline in June represents the fourth straight month of nominal decreases in the country’s volatile residential real estate market, resulting in a total decrease of -0.23 percent in 2017.

In June, twelve of the twenty cities surveyed outpaced May’s expected inflation rate of -0.15 percent, as measured by the IPCA/IBGE (National Consumer Price Index/Brazilian Institute of Geography and Statistics). Of those twelve cities, the biggest increases in June were seen in Santos (0.61 percent), Fortaleza (0.57 percent), Florianópolis (0.51 percent), and Vila Velha (0.21 percent).

Of the twenty cities surveyed, thirteen showed nominal declines in residential real estate prices from May to June, with the biggest drops registered in Niterói (-2.51 percent), Rio de Janeiro (-2.17 percent) and Distrito Federal (-1.92 percent).

In June, the average price per square meter among the twenty cities surveyed was R$7,668. Despite showing one of the surveys biggest drops last month, Rio de Janeiro once again led the way with the most expensive residential real estate sale prices in the country. The Cidade Maravilhosa had an average sale price of R$10,082 per square meter.

Trailing Rio de Janeiro was Brazil’s financial capital, São Paulo with an average price per square meter of R$8,680, followed by Distrito Federal at R$8,385 per square meter. The cities with the lowest average residential real estate value per square meter were Vila Velha at R$4,654, Goiânia at R$4,127 and Contagem at R$3,526.

Along with having the most expensive residential sale prices in Brazil, Rio also had the three most expensive neighborhoods in the survey. Rio’s upscale neighborhood of Leblon had the honor of being Brazil’s most expensive neighborhood, with real estate sale prices clocking in at R$20,987 per square meter. Not too far behind was Ipanema, at R$19,915 and Lagoa at R$18,100.

In São Paulo, Vila Nova Conceição had the city’s most expensive real estate sale prices, at R$16,478 per square meter. Next was the neighborhood of Jardim Europa at R$15,234, followed by Jardim Paulistano, at R$14,452 per square meter.

Looking at the last twelve months, nine of the twenty cities that were surveyed showed nominal declines in residential sales prices, with the worst declines in Nitéroi (-2.51 percent), Rio de Janeiro (-2.17 percent), Distrito Federal (- 1.92 percent), and Goiânia (-1.88 percent).

Of the cities that showed increases in the last twelve months, only two showed a higher variation than the accumulated rate of inflation of 3.08 percent. Belo Horizonte, the city that registered the biggest increase in the period, outpaced inflation with prices rising 6.65 percent. The other city beating inflation was Florianópolis, with prices increasing 3.16 percent over those twelve months.

The FipeZap Index monitors real estate sale prices across twenty Brazilian cities and is a monthly gauge of real estate prices. It is prepared jointly by the university research center, Fipe (Economic Research Institute Foundation) and the Brazilian online real estate platform, Zap Properties.