Market Roundup: Real estate financing could leverage the Brazilian economy in 2024

Real estate financing as a lever for the Brazilian economy in 2024

Caixa, Brazil’s largest public bank, released its 2023 earnings report this week. It posted a recurring net profit of BRL 11.7 billion (USD 2.3 billion) last year, up 20 percent from 2022. The result was driven by the 10.6 percent expansion of the bank’s credit portfolio to BRL 1.1 trillion. About 65 percent of this portfolio is made up of real estate loans, which more than tripled last year.

Backdrop. Caixa’s results and Brazil’s real estate sector as a whole have grown in recent years despite double-digit interest rates and high levels of household debt. A resilient labor market and new funding sources offset the effect of the continuous decline in Brazilians’ savings.

Last year, the volume of loans for real estate purchases reached BRL 251 billion, the second-highest result in the country’s history, behind only 2021.
For the first time, the market’s main funding sources came from alternative instruments — such as investment funds and bonds — and the FGTS mandatory severance fund, from which workers can withdraw money in very specific situations, including for the purchase of real...

Fabiane Ziolla Menezes

Former editor-in-chief of LABS (Latin America Business Stories), Fabiane has more than 15 years of experience reporting on business, finance, innovation, and cities in Brazil. The latter recently took her back to the classroom and made her a Master in Urban Management from PUCPR. At TBR, she keeps an eye on economic policy, game-changing businesses, and people driving innovation in Latin America.