When It Comes To Real Estate Bubbles, China's Got Nothing On Brazil

Jan 19 2014, 3:06am CST | by

When It Comes To Real Estate Bubbles, China's Got Nothing On Brazil

World investors may be worried about China’s real estate bubble. But only one country surpasses that market’s housing boom, and that’s Brazil.

Whether it’s because of the new mortgage market and low interest loans available to Brazilians earning more money, or just a plain old over-stretched housing bubble, the roof has blown off Brazil’s housing market. Anyone who has bought a home in Brazil is smiling wide with its increased valuation. Anyone trying to buy a home has surely been priced out of a market or two over the last five years.

The sober Bank for International Settlements — the Central Bank of the world’s Central Banks — said this week that over the last five years no market on earth was hotter than Brazilian housing.

In fact, Brazil home prices rose a whopping 121.6% from 2008 to 2013, more than housing prices in Hong Kong.

Hong Kong housing prices rose 101.4% in that same period.

Brazilians have been paying more for housing than most other emerging markets, including big and richer global city-states like Singapore (62.5%).

Brazilians that bought homes during or slightly after the crisis have seen their housing values soar since.

The Bank (BIS) examined housing markets in 50 countries,  using local real estate indices measuring average prices per square foot and average new home price.  For Brazil, BIS used Central Bank indices that weigh housing prices in 11 major cities, including Rio and São Paulo, far and away the costliest cities in the country.

The biggest boom occurred right after the financial crash in the U.S. in 2008 and lasted well into 2011. Housing prices were rising on average of 20% in those cities.

In 2012, Brazil’s housing market began to cool. And now, while prices are still going through the roof, they are not going through it as fast, or making as much noise. Still, a 9% increase in 2013 is nothing to suggest a bubble is popping.

In the last 12 months, prices rose around 7%, according to the study. In the last six months, they’re up 4.6% as Brazil’s economy remains sluggish.

Liam Bailey, a senior researcher at Knight Frank, told Estado de Sao Paulo newspaper on Friday that Brazil’s overheated real estate market actually made it a bit less attractive. He likes Dubai and big cities throughout Turkey for foreign real estate buyers.

“Brazil is still a market for local investors,” Bailey said.

The Hottest Real Estate Markets On Earth

Source: Forbes Business


Don't miss ...


<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.


blog comments powered by Disqus

Latest stories

Ebola virus detected in semen three months after symptoms end
Geneva, Nov 28 (IANS/EFE) The World Health Organisation (WHO) warned Friday that the semen of men recovering from Ebola can contain the deadly virus up to three months after the symptoms disappear.
Hitachi evinces interest in developing Andhra ports
Hyderabad, Nov 28 (IANS) Japanese multinational conglomerate Hitachi has shown interest in developing ports in Andhra Pradesh.
Ebola test results now in 15 minutes!
London, Nov 28 (IANS) A 15-minute blood and saliva test for Ebola is to be tried in Guinea.
Japanese scientists develop hybrid silk using spider genes
Tokyo, Nov 28 (IANS/EFE) Japanese scientists have developed through genetic engineering using genes from spiders and silkworms a super resistant silk which could be used for textiles as well as in the surgical field, media reported Friday.

Latest from the Network

Apple Black Friday Sale Released
The Apple Black Friday 2014 Sale has launched online at the Apple Store. Apple has announced a huge charity promotion to fight AIDS for Black Friday and Cyber Monday. Apple will donate a portion of the sales the company...
Read more on Apple Balla
A look at Black Friday video game deals
All major retailers will be getting in the video game Black Friday spirit. PS4 and XBox One will certainly be two consoles that should garner huge sales but actual games should do good as well. One thing that is for...
Read more on Black Friday Countdown
Comics looking for event filled Black Friday
While video games and other electronic gadgets look to be the big draw on deals during Black Friday, comic book readers and fans will be able to find their fair share of deals as well. It has been announced that two...
Read more on Black Friday Countdown
Anna Kendrick positive after nude photo leak
Anna Kendrick is looking at the positives following the recent hacking of her nude photos. The 'Pitch Perfect' star - whose naked pictures were posted online by hackers earlier this year alongside other stars like...
Read more on Celebrity Balla
Benedict Cumberbatch hates selfies
Benedict Cumberbatch hates selfies. The 'Imitation Game' actor - who recently announced his engagement to Sophie Hunter - won't be personally taking any photos of him and his bride on their wedding day and instead would...
Read more on Celebrity Balla
James Franco filmed threesome with Zachary Quinto
James Franco and Zachary Quinto filmed a threesome for their new film 'Michael'. The actors took part in the sexy scene alongside the former 'Desperate Housewives' star Charlie Carver for the upcoming drama, according...
Read more on Movie Balla
UN condemns attack on British embassy vehicle
United Nations, Nov 28 (IANS) The UN Security Council (UNSC) has condemned the attack on a British embassy vehicle in Kabul, Afghanistan. "The members of the UNSC expressed their deep sympathy and condolences to the...
Read more on Politics Balla
Not all mosquitoes can transmit malaria
New York, Nov 28 (IANS) A genetic study has revealed that certain species of mosquitoes have evolved to better transmit malaria than even some of their close cousins. The study may advance understanding about the...
Read more on Business Balla
Rio judge ends Olympic golf course impasse
Rio de Janeiro, Nov 28 (IANS) A Rio de Janeiro judge has rejected a request by public prosecutors to suspend an environmental permit for work on the 2016 Olympic golf course. Judge Eduardo Antonio Klausner said there...
Read more on Sport Balla