Sao paulo real estate values take a tumble

Property prices in Sao Paulo fell in the final months of 2010 but there is little cause for concern, especially given the rapid growth preceding the minor falls.

The Regional Council of Realtors for the State of Sao Paulo (CRECI-SP), which currently represents 529 estate agents and/or agencies recorded a 3.53% drop in prices year on year for October, as well as a 25.6% sales contraction for the period. 

We can take heart in the fact that this is being called a correction. Sceptics will pick up on the fact that the UK crash is still being called a correction by estate agents and market bulls, but in the case of Sao Paulo 1 bedroom apartments grew in value by 100% between 2008 and 2010 according to the regional realtors association EMBRAESP, and 2-4 bedroom apartments by 40-60% during the same period.

With the Brazilian economy still so strong, a population growing rapidly not only in numbers, but so rapidly in affluence that 12 million people were added to the middle class in the last 8 years, not to mention a government dedicated to helping its middle class onto the property ladder, it certainly does look like this cooling will be looked back upon positively. Most likely it will be seen as the point where the runaway growth in the Sao Paulo property market turned into sustainable annual growth.

Source: Overseas Property Mall