The Brazilian real estate market showed a 42.5% drop in the number of launches in the first quarter of 2022, compared to the fourth quarter of 2021, the Brazilian Chamber of Construction Industry reported today (23). The number of launches also showed a drop of 7.6% in the final offer of projects. According to the CBIC, the increase in the price of inputs and the economic situation weighed on the reduction.
The survey, which collected information from the construction industry market in 196 cities in all regions of the country, also showed a drop in the first three months of the year in the number of launches of units of the Casa Verde and Amarela program, in relation to the last quarter of 2021.
Units were reduced by 40.4% and the final offer by 11.1%. The CBIC said that the numbers are affected by the increase in prices and costs of construction materials, by the lack of confidence for new launches by entrepreneurs and developers and by the fall in the purchasing power of families.
“We talk all the time about the cost increase effect that impacts the sale price and this is very clear in Casa Verde e Amarela, which has been pushing the housing market in recent times”, said CBIC president José Carlos Martins during a press conference to data presentation.
According to Martins, steel was the material that most impacted the total increase in the cost of the works. He cited the example of building a bridge, which had a rise in the costs of the material used by about 73% in the period from July 2020 to July 2021.
“When we analyze a bridge, for example, the increase was 73% for a single item, which is steel. In the case of Casa Verde e Amarela, this impact was 34% in a single item”, he pointed out.
Martins said that the reduction in the import rate of the input, along with 10 other products, announced by the government to contain the rise in inflation, slightly reduced the pressure on cost increases. However, there is still a need to discuss price stabilization with the production chain.
housing program
In the first quarter of 2022, 22,334 Casa Verde e Amarela units were launched, representing 42% of the total number of projects launched. As for the other standards, there were 30,738 units, 58% of the total. During the period, 36,827 units of Casa Verde and Amarela were sold (50%), and 37,096 units of the other standards, which shows the demand for units of the program.
The CBIC defends changes to the program in points such as: the increase in the value of the subsidy given; regulation of a guarantee fund, so that entrepreneurs can once again increase the number of projects and improve the granting of credit.
Petrucci also said that the scenario shows that entrepreneurs and developers are not passing on the impacts of the increase in cost in projects with works in progress. “We realize that the increase in costs got stronger and that entrepreneurs managed the impacts of the increase in the cost of projects with works in progress. However, for new launches, this pass-through in the sale price is inevitable”, he said.
releases
The comparison of the regions in the Casa Verde and Amarela launches shows the North with 85% share, the Northeast with 51%, the Southeast with 44%, the South with 32% and the Midwest with 24%.
In units sold, the Southeast region leads with 56%, followed by the Northeast (52%), North (49%), Midwest (40%) and South (36%). The share of the final offer represents: Southeast (46%), Northeast (44%), Midwest (31%), North (29%) and South (25%).
In the real estate market as a whole, in relation to the 4th quarter of 2021, the Southeast was the region that most recorded a drop in launches with 52%, followed by the North Region (51.2%), South (39.7%), Midwest (8.2%) and Northeast (7.1%).
In comparison with the 1st quarter of 2021, the Midwest and Southeast regions recorded increases of 11.4% and 7.5%, respectively. The others fell: South (27.9%), North (5.7%) and Northeast (1.7%).
CBIC said that in terms of sales, there has been a growth trend since the 1st quarter of 2017, but from the 2nd half of 2021, they began to stabilize. Compared to Q4 2021, the number of residential units sold rose 2.2%.
In comparison with the previous quarter, three regions registered an increase: Central-West (13.9%), South (13.4%) and Northeast (8.6%). The other regions registered decrease: Southeast (4.4%) and North (2.1%).
final offer
With regard to the final supply of units, compared to the 4th quarter of 2021, all Brazilian regions showed a decrease: South (9.3%), Southeast (7.3%), Northeast (7.2%), North (7.1%) and Midwest (5.2%).
