By Marisa Paska, Contributing Reporter
RIO DE JANEIRO, BRAZIL – With the 2013 FIFA Confederations Cup and the World Youth Day in the past, the temporary rental market has already started to set sights on the 2014 World Cup. Although the city of Rio says they have enough hotel rooms available, many visitors are looking for more space and the comforts of home while in Rio.
World Cup organizers, FIFA and other major sponsors, have already reserved hotel space in bulk as well. No one doubts that from June 12 to July 13, 2014, accommodations in Rio will be extremely scarce, with many reliant on temporary property rentals.
Renting a temporary apartment in Rio means either going through a personal connection or finding a rental agency based in Brazil. So far, many property owners were unwilling to set prices for their rental properties, wanting to take full advantage of the earnings opportunity, as they expected prices to increase as the event neared.
However, now that the Confederations Cup is over and the World Cup itself less than a year away, interest in rentals is rising and the market is beginning to show discernible form. One Rio resident who works in property management told The Rio Times he closed a deal to rent his own Copacabana a studio apartment for US$7,000 (R$14,000) for four weeks during the World Cup period.
Those with the deed to more luxury accommodations are looking at much larger numbers. Penthouse apartments of four or more bedrooms in Leblon or Ipanema are asking on average US$150,000 (R$300,000) for four weeks of rental, with seemingly no price limit for super luxury properties.
Even with demand drawing such astronomical rates, there are plenty of Cariocas who want to remain in their homes and attend the events themselves. Some residents, such as British School Teacher Peter Stanton, think that being able to host family and friends is more important than making a quick buck.
“We have so many friends that want to come here for the World Cup,” says Stanton. “You don’t charge your friends rent. Its nonsense.”
Others, like Carioca Eliza Siga, feel its too risky to have a stranger come and stay at their house. “I would rent to a friend of a friend, but I don’t want someone who I don’t know in my apartment with all of my things. They could ruin my flat, and they aren’t from here, so they might not be respectful of my building or my neighbors.”
However, as American tourist Connor Ahearn pointed out, the rental opportunity is too good of an opportunity financially for homeowners to miss out on. “I imagine a lot of people are renting out their places. The money is too good not to. It’s definitely what I would do if I lived here,” he told The Rio Times.
Rental agencies are taking advantage of the opportunities that comes in conjunction with the World Cup and the Olympic Games as well. Working on 15 to 20 percent commission with such exaggerated rental prices could prove to be a singular opportunity for a large payday, especially in a rental property market that has already begun to show signs of slowing.
With many properties asking for a fifty percent deposit upfront almost a year in advance, these rental contracts are also an opportunity for property owners to commence or complete desired improvements on their properties.
Brazilian Beach House owner Steven Chew helped the owners of a four-bedroom Villa on Avenida Niemeyer to rent their property for the World Cup as early as May of 2013. Chew says that the owners are using the deposit money to complete several renovation projects on the property, which will increase its value in future rentals.