Will the break in Brazil come in a year?  In three years?  In five years?  How long do investors have in Brazil?

Brazilian assets have been zooming up in value.  The Bovespa is up 100% since November 2008.  Stock market bull runs usually indicate good things for real estate, but equally, stock market corrections tend to be negative – and what is that strange hesitation we see at the end of the Bovespa curve?  A correction!  Minor – but a correction all the same.

 

 Foreign investors have done excellently – the currency has appreciated 45% in 18 months. 


The Brazilian authorities seem to on the case. They have put a tax on foreign investment, and they’ve been raising interest rates.

 Yet the “usual crowd” of doomsayers (who tend to get it right) have been warning the world about Brazil:

Roubini (May 31, 2010)

The Economist (May 20, 2010)

The IMF (April 2010)

The Financial Times has a nice story about about an air stewardess who bought a flat in São Paulo’s fashionable Jardins neighbourhood “on the drawings” in 2008 for R$205,000, and sold it when she got the keys this month for R$355,000.

The piece also gives us some snapshots of how property prices are rising across the country: 100 per cent over the past five years in São Paulo; 100 per cent in two years in Rio; 50 per cent in two years in Brasília; 60 per cent over the past year in Recife, and so on.

For Brazil "it is all upside" says Newsweek, in a glowing piece.

Proxy for 'sell now'?