Construction in Brazil Continues Upwards

With two top sporting events just round the corner and 3 million social homes to build by 2014, construction in Brazil continues on a strong upward trend. This together with the increases in employment and wages in the Brazil building industry points to a booming market for investment.

Statistics for the construction industry in Brazil show the sector grew by 0.66% in June this year, almost double the increase seen in June 2009 (0.35%). Last month's rise brings the cost of building in Brazil to R$747.26 per square metre. So far this year, the cost of building materials has increased by almost 2.5% and the cost of labour by almost 7%. The highest rises in construction costs were found in south Brazil, followed by the north east region where the square metre now costs R$702 - up 7% from this time last year.

Reflecting the boom on construction are Brazil's figures for employment and wages. June saw a further drop in the number of unemployed, which now stands at 7% of the population, and the average monthly wage is currently R$1,423. Unsurprisingly, the construction industry has seen the highest increases in salaries - at R$1,227.40, wages have gone up 7.5% this year alone.

Everything in Brazil indicates that these rises are set to continue at least for the next decade. With the floodgates open for foreign investment in Brazil and massive construction projects underway, the building industry will undoubtedly break more monthly records.

The figures behind building in Brazil are massive, not just for infrastructure but also for property. Infrastructure investment for the 2014 World Cup runs to R$29.6 billion. Civil construction is due to be the largest beneficiary of this investment in Brazil - a recent study indicates that construction for the football tournament is expected to generate R$8.14 billion.

When it comes to property, Brazil also boasts some eye-opening numbers. This is a country where the government social housing programme, Minha Casa Minha Vida has pledged to build no less than 3 million homes by the end 2014. And these homes are just for those at the lower ends of wage-earning scale. The coming of age of Brazil's young population and their increase in purchasing power means that the demand for real estate in Brazil will soar over the next 20 years. According to Ernst & Young, Brazil will build 37 million properties by 2030.

The construction boom is obviously well underway - Rossi Residencial SA, one of Brazil's largest real estate companies in terms of market value, has just published provisional figures for Q2 this year. From April to June this year, Rossi and its associates launched homes to the value of R$1.1 billion, an increase of 152% on the same period in 2009. Total sales made by the Brazil real estate giant amounted to R$905 million, 79% higher than Q2 last year.

Investment in property or property-related products with Obelisk in Brazil is also well underway. Since the start of this year, Obelisk has released several highly successful products and several more in the pipeline due for launch this year. Why not join Obelisk and make the most of investing in Brazil's upward trend?

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