Business · Economy · 22 hrs ago
Brazilian property sales dip briefly around elections, historical data suggests
Brazil’s housing market may slow briefly during elections, but historical sales data suggests it does not stop.
The dip is concentrated in the three weeks between the two rounds of voting, with sales recovering quickly afterward.
In past elections, sales fell by about 15% in Belo Horizonte and 6% in Rio de Janeiro during that period.
In São Paulo, the drop across the last five presidential elections became smaller, declining from 20% to 5%.
Commentator Duda Herriot says interest rates have a stronger effect on property sales than election results do.
Sales rose sharply in São Paulo and Belo Horizonte in 2021 when rates were very low, then fell by 15% to 20% in those cities in 2022 as rates returned to double digits.
Herriot says sellers should not take homes off the market just because of an election, and buyers should not expect the price per square meter to fall.
Brazilian property sales typically dip briefly during election periods, but historical data suggests the decline is less severe than many people believe.
The slowdown is concentrated in the three weeks between election rounds, with sales recovering quickly after the second round.
Reported declines during that period were about 15% in Belo Horizonte and 6% in Rio de Janeiro.
In São Paulo, the decline across the last five presidential elections fell from 20% to 15% and then 5%.
CNN Brasil commentator Duda Herriot said interest rates have a greater effect on the property market than election results.
- Who
- Duda Herriot, a CNN Money commentator on the property market, analyzed the figures.
- What
- Historical data indicates property sales dip briefly during election periods, then recover quickly.
- When
- The slowdown is concentrated in the three weeks between election rounds.
- Where
- The figures cover São Paulo, Belo Horizonte and Rio de Janeiro.
- Why
- Herriot said election-related uncertainty can contribute to a short pause, but interest rates are a more important market factor.
This story does not have two clearly opposing sides.
There is a widespread belief that the property market freezes because people feel insecure.
There is a three-week stumble between rounds.
You have to keep an eye on the interest rate.
The property market is a very resilient market.
With interest rates at historically low levels, sales volume rose 46% in São Paulo and 52% in Belo Horizonte.
As interest rates returned to double digits, sales fell between 15% and 20% in São Paulo and Belo Horizonte.
- Belo Horizonte
- Sales fell about 15% during the three-week interval between election rounds.
- Rio de Janeiro
- Sales fell about 6% during the interval.
- São Paulo
- Across the last five presidential elections, the decline fell from 20% to 15% and then 5%.
- 2021 sales
- Volume rose 46% in São Paulo and 52% in Belo Horizonte.
- 2022 sales
- Sales fell between 15% and 20% in São Paulo and Belo Horizonte.
Sources
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