According to a real estate analyst, Brazilian savings (“recursos da poupanca”) will be insufficient to sustain expansion of the mortgage (and overall credit) at the current rate. And you know what happens when credit stops flowing into real estate? Yes… the bubble burst and asset prices start falling. 

In his opinion, the weakening credit growth (because of low savings) will impact real estate prices. The expansion of real estate mortgage in Brazil will not remain at the current rate. The logic behind this analysis is financialbanks will not have money to lend at current interest rates.
Full article here
Another sign of real estate troubles in Brazil comes from falling rental transactions.
Renting a residential property in the city of São Paulo was on average 4.97% more expensive in June, compared with the previous month. The price increase is likely the cause of the 8.97% fall in housing rentals the fourth consecutive month of decline in the residential rentals in SP“This situation may indicate that we have reached rock bottom in the relationship (disconnect) between the families’ affordability and the prices expected by owners,” says Jose Augusto Viana Neto, president of the Regional Council of Realtors State of São Paulo (Creci -SP).”
Full article here.


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