Brazilian Housing Explosion Continues
The Minha Casa, Minha Vida scheme launched three months ago with the intention of providing affordable housing to Brazils growing middle class has proved a massive success with huge numbers signing up.
The State Company of Popular Dwellings (CEHAP), which is leading the development of the affordable housing boom in Brazil, has had 125,811 families register so far. Other Brazilian companies and international developers are also joining this booming market.
There are currently in excess of 21,000 new homes planned and approved in Brazils North Eastern state of Paraiba states the Brazilian Institute of Geography and Statistics. This has led to great interest from private developers interested in the affordable housing arena as a report from the Ministry of Cities in 2008 states that Paraba needs at least 122,000 new homes.
The State Government is supporting the re-zoning of land in the area for the development of popular housing and has announced a number of proposals to assist constructors who are focusing on the sector.
Minha Casa, Minha Vida has provided an impressive R$60bn into Brazil’s housing market, and with the construction industry accounting for 5 per cent of Brazils GDP this will give a valuable boost to employment and earnings.
The Brazilian Government announced that it would plow another R$10 Billion into its flagship affordable housing scheme, Minha Casa, Minha Vida in 2010. The scheme was introduced as a result of the worldwide economic crisis to boost construction and reduce the country’s housing shortage which is estimated to be in excess of 7 million units.
Public funds will be used to subsidize their home purchase, keeping monthly mortgage payments below 10% of the buyers income, with mortgage payments guaranteed by a Treasury fund.
Brazilian Finance Minister, Guido Mantega says that Minha Casa, Minha Vida is the one of the Governments core anti-crisis schemes and will have a huge impact on the Brazilian economy.
Goldman Sachs chief economist Jim O’Neill now predicts that the major emerging markets”Brazil, Russia, India and China, a.k.a. the BRICs”could overtake the combined GDP of the G7 nations by 2027, nearly a decade sooner than the forecast in a landmark study a few years back.
Leslie Richards is a land investment consultant to Brazil land Invest and wrote this piece on the Affordable Housing sector in Brazil and invites you visit Brazil Land Invest for more information information about property development in this exciting sector in North East Brazil.