Low interest rates in Brazil
In recent years, interest rates in Brazil have changed significantly and the country has managed to drastically improve and maintain them at a stable level. Interest rates have been at their lowest level over the last few years at 6.5%. This has transformed the lending environment for Brazilians, and bolstered interest from foreigner investors. Future expectations are positive: better borrowing conditions means higher consumption leading to increasing GDP. The chart below shows the downward trend of interest rates.
Why is this the perfect time for investors to act?
As stated before, interest rates are low. This is just not the only reason for why this is the perfect time to invest in Brazil. Also, it is clear that if inflation rises but salaries don’t, people wouldn’t be able to spend money as products would be too expensive. The good news is that Brazil’s wages are higher every year.
According to Trading economics, Wages in Brazil increased to 2295 BRL/Month in April from 2291 BRL/Month in March of 2019. Wages in Brazil averaged 2207.86 BRL/Month from 2012 until 2019, achieving all-time record of 2295 BRL/Month in April of 2019. Salaries in 2019 are 3% higher than those of 2018 Also, the unemployment rate has again, gone down from 12.70% to 12.50%.
Property prices are rising
Property prices are on the rise too. Housing Index in Brazil increased to 129.60 Index Points in April from 129.40 Index Points in March of 2019. Housing Index in Brazil averaged 123.95 Index Points from 2012 until 2019.
Rental prices are also increasing. Fipezag figures have shown a notable rise on the rental average. From January to April this year, the average on rental prices has increased by 2.5 per cent. This is a great opportunity for “Build-to-sell” and “Build-to-let” investments.
See the investment opportunities in Brazil, here
(Source: Trading economics)