By Nelson Belen, Contributing Reporter

RIO DE JANEIRO, BRAZIL – The upscale neighborhood of Leblon remains the most expensive in Rio de Janeiro, but in October prices in the exclusive area fell slightly from September’s R$21,789 per square meter to R$21,727 last month. The news comes as the country’s economy continues to look bleak and the state remains in a financial crisis.

Ipanema and Leblon Beaches
Despite the decline in values, Rio de Janeiro is still Brazil’s most expensive city, photo by Fernando Maia/RIOTUR.

Despite stagnant and falling housing prices throughout Brazil, Rio de Janeiro continues to be the city with the most expensive square meter in the country (R$10,236), followed by São Paulo (R$8,622). Contagem (R$3,611) and Goiania (R$4,111) were the cities with the lowest average value per square meter.

Mike Smith, an American expatriate that has been living in Rio for eight years feel like this trend needs to continue. “As a renter, and someone hoping to buy, the prices still feel way out of proportion with the economy and incomes here. My sense is that the prices should come down another 10-15 percent.”

The latest data comes from FipeZap Index, which tracks fluctuations in home and apartment prices advertised for sale in twenty Brazilian cities. According to the index, the price of real estate in Brazil rose 0.11 percent in October, lower than September’s 0.12 percent variation.

The October increase was below the Broad National Consumer Price Index (IPCA) for the month, 0.3 percent, according to the Focus Bulletin of the Central Bank. For October, only four cities rose above the IPCA: Recife (0.58 percent), Porto Alegre (0.31 percent), Curitiba (0.76 percent) and São Caetano do Sul (0.40 percent).

Meanwhile, in seven cities, property prices dropped: Federal District (-0.25 percent), Vitória (-0.10 percent), Santo André (-0.23 percent), Niterói (-0.01 percent), Contagem (-0.04 percent) and Goiânia (-0.53 percent).

In the accumulated period from January to October of year, the index shows a slight increase of 0.38 percent. Five of the twenty areas surveyed recorded nominal price drops in this period: Rio de Janeiro (-1.87 percent), Distrito Federal (-0.86 percent), Recife (-0.19 percent), Niterói (-2.01 percent) and Goiânia (-2.33 percent).

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