Thursday, Sep 02, 2010
This looks and sounds familiar
BBC: Mortgages fuel Brazilian housing boom
There is music, drinks, food and smart people, but this is not an ordinary party; it is the launch of yet another real estate development in Sao Paulo, Brazil's largest city. Construction of the properties that are up for sale has not yet started and buyers will not get into their new homes for another two years, yet the competition for the best spots is fierce. When a customer decides to buy, the estate agent has to rush through all the relevant the documents before a competitor closes the deal. "Last night I didn't have any sleep because we spent all night closing deals," says sales supervisor Thiago Davidian. "My team sold more than 50 units yesterday and more are going as we speak."
Posted by jack c @ 03:37 PM (955 views) Add Comment
15 Comments
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1. Here We Go Again >:-( said...
If Brazil is succumbing to its greed .... they are screwed.
2. mark said...
Well this is what you do, go to Brazil and buy the most expensive property you can, put it back on market cash offers only and when sold do a runner with the cash rather than pay the mortgage off..
3. sibley's b'stard child said...
What sort of rental yields can I expect from my BMV/off-plan purchase?
4. timmy t said...
What could possibly go wrong?
5. sibley's b'stard child said...
Nothing at all Timmy, the nice man at the seminar told me it was a one-way bet. 'pparently, you don't even need to view the plot; just borrow the money and then they'll answer any questions later. In fact, he gave me a cast-iron guarantee that the company will still be trading by the time the development is completed.
Best 5k i've ever spent, I can tell you.
6. gone-to-colombia said...
Morons, it was the same here a few years ago. Those high rise blocks remain empty.
The bubble has already burst here, prices are down 25% on two years ago.
Brazil cannot be far behind.
7. Crunchy said...
I see some off plan investors taking a brazilian haircut on this one.
8. jack c said...
How about this for a plan - buy into the Brazillian housing boom (must be true because the Beeb say so) then quickly withdraw the equity and use it as a deposit on properties in Spain, Dubai, USA and Eire (where prices have dropped back temporarily) and when the world market recovers (as it will because prices only ever really go up) we can all live happily ever after on Pleasure Island with J Worthington Foulfellow.
9. Crunchy said...
1. mark
Arriba, arriba!!!!
10. The Baldman said...
Unable to ramp the Uk market the BBC has to ramp propertry somewhere in the world
11. charlie brooker said...
@jack c
Sounds like a plan. I'm in.
Now where's me tablets.
12. Pwez said...
"How about this for a plan - buy into the Brazillian housing boom (must be true because the Beeb say so) then quickly withdraw the equity and use it as a deposit "
Removing the money from Brazil is very difficult, apparently. So its not much of a plan.
The BRIC's have far more development needs, the boom is quite likely to last a very long time, what with their oil and agricultural booms.
13. drewster said...
It might be a justified boom. What are the loan-to-value ratios on the mortgages? What are the yields on these properties? Are people buying to live in, or buying to flip?
- Loan-to-value ratios are conservative (60%). That compares well with Northern Rock's 125% fail.
- Yields look acceptable. They currently pay 1000 reais per month on the mortgage. Their rent for a "much smaller" house was 650 per month. Assuming the new house is 50% bigger/better then that's an improvement.
- Best of all, most of these people seem to be buying to live in rather than just speculating.
Compare with China, where LTV ratios are good but yields are terrible and buy-to-flip gamblers are everywhere. Brazil sounds safe for now. It they carry on this way for several years it might be more of a risk though.
14. Buyinbrazil said...
60 k buys you a beautiful flat overlooking the sea in a very safe area just south of rio .lovely people .cheap booze ,great southern hemesphere winters etc .falle portugese? still a bloody long way from blighty and places where violent crime may occur too numerous.
15. mr g said...
Is this the type of growth referred to when they say the "BRIC" economies will lead the world recovery?