Salient to Investors:
Prices to buy and rent houses and apartments in Rio’s top neighborhoods have risen six-fold in the past decade – as expensive as New York and Paris. On discovery of vast deep-water oil deposits in 2008; on hosting the 2016 Olympic Games; on a surge in world demand for Brazil’s commodities.
The volume of mortgage lending slowed to a two-and-a-half-year low in July. Rio office rents are declining .
Marcio Guedes at J. Safra Banco de Investimento doesn’t expect the same real estate exuberance over the next six months as over the past five years because the broader economy has decelerated.
Thomas Shapiro at GTIS Partners says the market is healing itself but will get weaker before it gets better, and planned developments in Brazil that don’t attract enough buyers before construction get canceled.
Pimco will open its first Latin American office in Rio in September.
Rio is the 13th-most-expensive city in the world for expatriates. Sao Paulo is 12th, the most costly city for foreigners in the Americas.
Rossano Nonino at Gavea Investimentos prefers malls and warehouses over residential housing – the Olympics will add thousands of units at the same time and sees a stabilization in residential rents and prices.