Rental Price Growth Slows Below Inflation in Rio de Janeiro
By Lisa Flueckiger, Contributing Reporter
RIO DE JANEIRO, BRAZIL – A survey by Rio’s housing union, Secovi-Rio, has shown that rents in Rio de Janeiro are rising much slower than they were a year ago. In most neighborhoods the increases in rent prices during the last year were below inflation, following the same trend as the real estate for sale, where prices have also seen a cooling off.
The rent price survey compared the period between January 2014 and January 2015 with the previous year between January 2013 and 2014. Within this time frame, nine of the seventeen neighborhoods surveyed had rent increases below inflation, which in this case was calculated by the Market Price Index, IGP-M, which is also used as basis for the annual rent adjustments and stood at 3.98 percent for the last year.
In Jardim Botânico rent prices fell by 3.9 percent last year, while Gávea and Lagoa remained more or less stable. The current square meter rent for January 2015 in the two neighborhoods stands at R$57 and R$59 respectively, according to the Fipe-Zap Index.
In Copacabana, rent prices increased around one percent over the last year according to the Secovi-RJ study. In the year before, between January 2013 and 2014 they had increased by 13.7 percent. The rent square meter in Copacabana currently stands at R$51.
In fellow Zona Sul (South Zone) neighborhood Botafogo, rent prices increased around 2.6 percent over the last year, while they had increased by fourteen percent in the year before.
However, in six neighborhoods surveyed, the prices increased more than the market price index over the last twelve months. Those areas were Ipanema with 6.7 percent increase, Flamengo with 12.6 percent, Centro with 22 percent, Ilha do Governador with 4.8 percent and Méier with seven percent.
The most expensive neighborhood to rent in Rio de Janeiro according to Secovi is Ipanema, with Leblon and Lagoa following as close second and third. The lowest rents of the seventeen neighborhoods surveyed (excluding most of Rio’s North Zone) are Jacarepaguá, Ilha do Governador and Méier.
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