Brazil: rental yields low, prices falling
December 27, 2018
|Last Updated: Dec. 27, 2018|
|RIO DE JANEIRO - Apartments||PRICE/SQ.M. (US$)||YIELD (p.a.)||PRICE/SQ.FT. (US$)|
|TO BUY||MONTHLY RENT||TO BUY||MONTHLY RENT|
|Barra da Tijuca||2,635||7.98||3.63%||245||0.74|
|SAO PAULO - Apartments|
|Jardins (America, Europa, etc)||3,167||13.13||4.98%||294||1.22|
|Vila Nova Conceicao||4,630||18.02||4.67%||430||1.67|
All yields are gross - i.e., before taxes, repair costs, ground rents, estate agents fees, and any other costs. Net yields (what you´ll really earn) are typically around 1.5% to 2% lower.
Sources: FIPE and ZAP Definitions: Data FAQ See also: Update Schedule
Prices have begun to move strongly down in Brazil, and in terms of US dollars the downward move is much greater because of the decline of the Brazilian Real by 30% over the past three years, with some recovery since the beginning of 2017.
Gross rental yields - what you can earn from an apartment before tax and other expenses - have continued to move down, and in most parts of Sao Paolo and Rio being a landlord generates a much less attractive return-on-investment than it did a few years ago. In Rio, yields of 3% to 4% are typical, in Sao Paolo apartment yields are rather higher.