June Real Estate Sales in Rio de Janeiro Grow 40 Percent over May

RIO DE JANEIRO, BRAZIL – A survey conducted by Secovi Rio (Rio de Janeiro’s Housing Union) shows that the city of Rio, particularly the real estate sector, is gradually rebounding from the economic impact caused by the novel coronavirus crisis.

The survey, which was based on Rio’s City Hall data, shows that residential real estate sales grew some 41 percent in the capital, comparing the 2,145 units sold in June with May’s 1,515.

The positive news spurred the market, which is facing a completely atypical scenario due to the financial collapse triggered by the Covid-19 pandemic and, initially, drove property buyers away. However, the return of positive results is becoming an increasingly credible reality, despite the still lower numbers compared to previous years.

Lucy Dobbin, sales superintendent of Sérgio Castro Real Estate, one of the leading real estate companies in Rio, commented on the difference between the scenario in the first months of the pandemic and the current moment.

In the first months of the pandemic, from March to May, with the uncertainties surrounding the advancement of Covid-19, the impacts of its restrictions on the economy, the jobs lost, and the survival of countless companies, there was a climate of great insecurity that directly impacted the real estate market. As a result, there was a downturn in the purchase intentions as well as in property owners’ desire to sell.

Once this initial stage was over, in June, the scenario was quite another: on the one hand, the need for many to part with their properties and accept offers, reducing their intended sale prices; on the other hand, after a long time spent in confinement, demand for properties better suited to the needs of families or individuals for space, and the large offer by banks of highly attractive credit lines, with interest rates never before practised,” explains Dobbin, who also stressed the return of investors to the real estate market.

“Even in low liquidity periods, this return provides security as a major attraction, compared to other investments that fell abruptly and incurred losses in the same period, such as stocks or investment in fixed income, the profitability of which is increasingly lower,” he explains.

West Zone neighborhoods top the list of best-selling residential properties

Secovi Rio’s data also points out that the West Zone was the region with the highest number of residential property sales. Of the five neighborhoods with the most transactions, four are in that region. The top-selling areas were Barra da Tijuca, Recreio dos Bandeirantes, Jacarepaguá, Copacabana, and Campo Grande.

André Toledo, director of Block Real Estate, a company focused on Rio’s West Zone, explains that prices at Recreio dos Bandeirantes, for instance, are similar to those in locations such as Irajá, Tijuca and Méier, which helps explain the region’s success among clients and the high rate of sales in the area.

“Today the Recreio neighborhood offers a totally differentiated quality of life, surrounded by many natural wonders. For the same price as you pay to live in Méier, you live in Recreio, overlooking one of the most beautiful beaches in the world. You also have [police patrol program] Recreio Presente, which has made the neighborhood even safer and, today, credit is very inviting. This has brought a demand for people from outside to come and live in Recreio,” comments Toledo, who celebrates the good sales moment in recent months.

“We are experiencing a significant increase in our business; we felt it in June when we beat our sales record, and in July we beat the June record. We hope to again exceed expectations in August. The market is very heated and we are working hard,” he celebrates.

Secovi Rio optimistic

Maurício Elias, Rio de Janeiro’s Secovi statistical coordinator, says the result creates optimism for the second half of the year and stresses that the most challenging scenario, between March and May, has been overcome.

“Social isolation has reflected on several sectors and generated great insecurity, particularly in the months of March and April. But the relaxation of quarantine and the return of economic activities enabled new negotiations and contracts, which adds optimism to the market and greater opportunities,” he said.