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Affluence Increasing In Brazil

March 8, 2010Article by Ray Withers

Brazil property owners and potential future owners got some very good news in the past week. A report by the Getulio Vargas Foundation has said that Brazil’s middle class has grown to 91million, a stonking 49% of the population.

This is good news for many different reasons:

Firstly the growing middle classes are demanding a higher calibre of housing, which is creating internal demand for luxury properties. This gives developers another buyer group to target, and foreign investors a solidification in their exit strategy. Not to mention the fact that the increasing size of middle classes usually means the upper class is increasing in numbers also.

A growing middle class means more Brazilians going on holiday, and with the eco-friendly push more of those will be holidaying in Brazil. Given the increasing trend of tourists using the internet to package up their own tailored-made holidays, this will undoubtedly increase the occupancy of Brazilian holiday accommodation, and therefore increase the rental yields as well.

Thirdly; Brazil is known for having a high crime rate. The main cause of crime in Brazil is poverty, as affluence increases within the population it will reduce the crime rate. But the biggest benefit in the current climate; is the increased safety investors will feel about buying Brazil property now that poverty is reducing, and the fact that people won’t feel guilty about spending in the country. This is according to international property investment consultancy Property Frontiers, director of the firm David Cox said:

“As we become more of a culturally ethical society, who buys fair-trade products and cares about the environment; spending large sums of money in countries where poverty is a major problem can make some people feel guilty.

“The fact that poverty is being reduced in Brazil will therefore increase potential buyer and renter numbers. The increasing affluence within the population is also an inherent sign of political responsibility and economic stability, which will increase Brazil’s image and reputation as a safe country to invest in. With Brazil recently winning the honour of hosting the World Cup and the Olympics, its reputation as a safe investment destination is growing rapidly.”

Property Frontiers are currently marketing the Natal Ocean Club in the north east’s premier city of Natal. The Ocean Club Development represents the pinnacle in modern design, architecture and luxury. The development also benefits from a unique location, set atop a cliff, overlooking the sea and the 300m of private beach owners can enjoy in exclusivity. Surprisingly prices start from just £138,000 for a 1 bedroom condominium.

Author

Ray Withers

Ray has over 17 years’ experience in the international property market and bought his own first international property investment back in 2002. Aside from running Property Frontiers, Ray has been involved in residential, hotel, student and commercial property investment and development in both the UK and overseas and co-wrote "Where to Buy Property Abroad - An Investor's Guide". As Founder and Trustee of the Frontiers Foundation, Ray is directly involved with many of its projects to ensure they have a direct and tangible impact in individual communities across the globe. He is passionate about property, travelling, scouting out new opportunities and finding time to spend with his young family.
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