São Paulo Property Sales Increase – Fuel Investment in Natal Property

Brazil - Pauba BeachProperty Sales in São Paulo have shown a substantial upwards trend, as completions increased by 48.1% from March to April of this year. Three bedroom apartments were the most popular accounting for 39.4% of sales, closely followed by two bedroom units at 35.2%. Four roomed units accounted for 15.3% of completions while one-room units totalled 9.9% of completions. Launches of new properties were also up, and were 39.2% higher when comparing March to April of this year.

The chief economist of SECOVI-SP, Celso Petrucci, is cautiously optimistic that the sales within the metropolitan region of São Paulo are starting to return to levels seen during the second half of 2010. A new positive credit law, Cadastro Positivo, sanctioned by President Dilma Rousseff will make it easier for banks to offer lower interest rates to consumers who can prove their good standing, and this will benefit the housing market.

This should also increase the competition so that those who have good credit ratings will be able to receive more credit offers. It is expected that this new law will prove popular with those borrowers who have little proof of income, but who will now be able to apply for loans on the basis of their credit ratings.

However it is expected that access to mortgages may become increasingly limited as the current level of mortgages being granted is higher than the savings which the banks have at their disposal. Alternative methods of offering mortgage finance are now being investigated within the sector, including the possibility of introducing a type of covered bonds which are already used in the Brazilian commercial property sector.

Natal property is to Sao Paulo what Koh Phangan property was to Koh Samui, as both thrived during the boom; the next market to emerge offering the same fundamentals for incredible growth. Natal is a huge city with growing demand for housing, additionally fuelled by its being a host city for the World Cup in 2014.

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