Running out of real estate in Brazil’s slums

TIMES INT'L

Brazil has at least six million fewer houses than it needs. And now, as the country’s booming economy fuels a real estate bubble, it’s the poor who are getting squeezed out.

As the makeshift apartments in Rio’s slums sprout extra stories, real estate experts say Brazil’s shortage of affordable housing has reached a breaking point.

Buyers are reeling from a one-two punch: countrywide inflation coupled with speculation as Brazil prepares to host the Olympics and World Cup.

Industry insiders worry the mounting costs are threatening to place homes beyond the reach of Brazil’s biggest, most promising market — middle and low-income buyers. The problem is most acute for those on the bottom rungs of the country’s economic ladder. And people earning a monthly salary of $1,000 or less account for about 90 per cent of the deficit.

In a country where the World Bank estimates the average monthly income is $670, spiking mortgage costs could eat up half a family’s income. (Excerpt from globalpost)

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