The Brazilian domestic real estate market is attracting huge foreign investment, helped by a strong and resilient Brazilian Economy.
Goldman Sachs Group and BNP Paribas have revised their 2009 GDP forecasts higher following an announcement by The Brazilian Institute of Geography and Statistics (IBGE). The Brazilian Government department stated that real GDP increased 1.9% from the first quarter.
Analysts were predicting growth of 3.5% for the year in July 2009, but have now revised this to 4 %, according to a weekly central bank survey of about 100 economists. They also forecast the economy to only shrink 0.16% this year, down from 0.73%. Brazil’s economy has rebounded from the global financial crisis and Brazil has defied analysts’ previous forecasts. The figures bode well for 2010 stated the Brazilian Finance Minister Guido Mantega.
Mantega adds the growth in Brazil is based upon positive trends in employment, services and industry. The Central bank of Brazil states that the new figures confirm that Brazil has already come out of recession.
A major factor in the quick turnaround experienced by the Brazilian economy is a series of measures introduced by the Government to incentivise the domestic real estate market and construction industry. Minha casa, Minha Vida has been a huge success and has contributed to the 2.1 per cent increase in domestic spending over last months figures.
Brazils construction industry was heading into decline after several years of strong growth and this scheme has reinvigorated the construction industry, which accounts for 5 per cent of Brazils gross domestic product.
Affordable housing is a major focus for the Brazilian Government, which announced that following reallocation of funding, it would dedicate a further R$10 Billion to the Minha Casa, Minha Vida initiative in 2010. The progamme is designed to boost the construction sector to offset the effects of the global economic crisis and alleviate the countrys housing shortage which is reported to be as much as 8 million countrywide.
As a member of the Group of Twenty economies, Brazil follows Germany and Spain to emerge from recession. Both European countries posted growth of 0.3% in the same period.
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