World Cup Could Create Property Boom In Brazil

Hosting the football World Cup, much like any other international sporting event, offers a whole host of various opportunities that can be beneficial to both a country’s culture and economy. The chance to flaunt itself on the world stage both on and off the pitch is one that, from a business point of view, is arguably too good don’t miss out on. Indeed, business stands to greatly benefit from the World Cup’s arrival, whether it is involved directly through means such as ticket management, or indirectly by way of hotels to accommodate supporters embarking on their once-in-a-lifetime trip. The idea appears to be to make Brazil a desirable brand, which everyone visiting will want a piece of. It is this idea alone that has whetted the appetite of property investors, who have already seen the tournament, and the Olympic Games two years later, as a unique chance to multiply profits and establish a firm financial foundation on which to build on for years to come. One only has to look at previous tournaments to see why there are is such excitement in the property sector. Past successes There were a number of successes being celebrated in the wake of the 2010 World Cup in South Africa. The number of tourists visiting the country during the tournament reached around 300,000, all of whom pumped millions into the economy thanks to spending money on meals, entertainment and accommodation. And it seems that many of those who visited liked what they saw, with the country seeing a significant rise in interest towards its property sector. The Times Live reported that the tournament had led to many celebrities considering South Africa for property investment. Many real estate agents noted a rise in viewings from high-profile figures during the month of the World Cup. Members of the elite and wealthy, and even politicians expressed interest in high-end properties in areas such as the desirable suburbs of Cape Town’s Atlantic Seaboard, many coming from countries such as the UK, US, Italy and France all expressed an interest. Even Qatar, which is not due to host the tournament until the year 2022 has seen its property market heat up in recent times, since the building work in Doha first got underway. According to a BBC report, much of the construction work has been for office spaces, which will be setup in order to accommodate the inevitable huge swathe of interest from businesses around the world. Demand driven by tourism Residential markets are also making positive strides, in order to accommodate the sheer numbers of people set to descend on the country and gain a piece of the financial benefits that come with the presence of international businesses. Demand in the real estate sector has been further strengthened due to strong economic performance and high energy prices, combined with significant government investment. And even if the World Cup fails to set Brazil’s property market alight, the country will have a unique second chance just two years later when the Olympic Games arrive. It is rare that two global sporting events are staged in the same country within such a short space of time, and the Olympic example is arguably just as glowing in terms of having a potentially positive effect on the country’s real estate sector. One only has to look at the effects from the fallout of the 2012 Games in London last summer to see that the Olympics could soon be just as effective in contributing to a prospective property boom. Indeed the period between 2012 and 2017 is expected to bring a total of 1.1 million visitors, bringing with them around £900 million, all as a direct result of the Games. There is no reason why the same effect cannot be recreated in Brazil over the next few years, with investment outliving the arrival of some of the world’s most prominent athletes. Rio itself is a city that is widely expected to set an example to the rest as to exactly what can be achieved when investors take advantage of the potential property boom. The city is already the most visited in the whole of the southern hemisphere, attracting more than 2.8 million tourists each year. According to the consulting firm Knight Frank, the R$30 billion being spent on infrastructure is certain to increase this number further, heightening the chances of investment in local property, as well as pumping millions into the economy. Knight Frank has also revealed that property prices in Brazil surged by 15.2 per cent during the third quarter of last year. Tim Morgan, chairman of the Leeds-based investment firm Emerging Real Estate, told the Yorkshire Post: “Forbes is forecasting that the World Cup will bring in around £36 billion into the Brazilian economy by 2014. “By 2012 Brazil had invested almost £7 billion in infrastructure projects such as stadiums, airports, improved roads and public transport, improving the lives of ordinary Brazilians and also making the country even more attractive to prospective investors.” Housing boom As well as attempting to attract investors and buyers from abroad, Brazil is also keen to address what many perceive to be a housing shortage for its own citizens, and the World Cup and Olympics have given developers the perfect reason to do so. One scheme to have emerged recently is the Minha Casa Minha Vida programme, which aims to build around three million homes over the course of five years. Mr Morgan added: “The initiative was designed to build and provide affordable housing for people on low to moderate incomes and harness investor funds to build the properties.” The potential boom is by no means limited to cities such as Rio either. Indeed there are some analysts who believe that the property markets in other areas of the country are set to be handed a chance to take advantage of the huge amount of tourism that will be witnessed during one of the most popular sporting showpieces on earth. A massive boost to tourism in the north east of Brazil is also set to ensure that international in interest in property is heightened to a level that has probably never been seen before. Like Rio, cities like Natal are already popular with many tourists, but organisers and developers are still keen to ensure that the city lives up to its full potential in terms of attracting investment. Some believe that one of the most popular areas will be the small beach town of Sao Miguel do Gostoso, which is widely regarded as the country’s capital for windsurfing and other water sports. Samantha Gore, sales manager of local real estate firm uv10, told Property Wire: “Sao Miguel do Gostoso has the perfect formula for water sports with year round wind and warm water temperatures, whilst being safe and quiet for families. The town is thriving with bags of character and boasts pretty bougainvillea draped multicoloured houses, a white sand beach dotted with fishing boats and coconut palms plus facilities such as a medical centre, day Spa, boutique hotels  and fresh seafood restaurants. “The property market shows a strong, healthy rate of growth with local and international demand. Little wonder Sao Miguel do Gostoso is regarded as one of the world’s best places to live.” It seems that the influence of the world’s greatest sporting spectacles are capable of reaching almost every corner of the country. Taylor Scott International