A study conducted jointly by researchers from the Brazilian Institute of Economics at Funda\u00e7\u00e3o Getulio Vargas (FGV IBRE) and QuintoAndar shows that the profitability of residential real estate reached a significant level in 2024. The financial return hit 19.1% per year, the result of the estimated rental income (6.2%) plus average property appreciation over the period (12.9%).<\/p>\n\n\n\n
This is the first time that researchers from FGV IBRE, one of the country’s most renowned economic analysis institutes, and QuintoAndar, the largest housing platform in Latin America, have partnered on a study.<\/p>\n\n\n\n
“The analysis suggests that the combination of property appreciation and rental income positions residential real estate as a competitive investment option in the post-pandemic context,” says Andr\u00e9 Braz, economist at FGV IBRE.<\/p>\n\n\n\n
From 2020 to 2024, the average annual return for residential rentals grew to 6.2%. To measure this value, data from listings and closed contracts on QuintoAndar were considered. To calculate total gross return, the Residential Real Estate Market General Index (IGMI-R), an index from the Brazilian Association of Real Estate Credit and Savings Entities (Abecip) in partnership with FGV IBRE, was also used. It estimates sale price variation based on appraisal reports from banks. This index rose 12.9% in 2024. That means a 50 m\u00b2 apartment purchased for R$365,000 a year ago would have yielded, on average, nearly R$70,000 in 2024 (combining rent and potential appreciation).<\/p>\n\n\n\n
“The study offers valuable insights into supply and demand dynamics in the sector, helping to identify areas or periods with greater investment potential. Building an analysis based on profitability estimates is an important contribution from QuintoAndar and FGV IBRE to democratize real estate market information,” says Thiago Reis, Data Manager at QuintoAndar Group.<\/p>\n\n\n\n
In addition to quantifying rental yield and calculating total return on real estate, the study also aimed to explore the factors driving appreciation in the rental market, analyze the interaction between construction costs and rental prices, and provide input for public policy and investment decisions.<\/p>\n\n\n\n
According to the researchers, S\u00e3o Paulo, Rio de Janeiro, and Belo Horizonte have seen a consistent recovery in rental prices in recent years, with gains similar to those of the pre-pandemic period. “This shows the market’s gradual heating up, reinforcing its resilience and the growing importance of this housing model in today’s economy, while also signaling an alternative for investors,” says the FGV IBRE economist.<\/p>\n\n\n\n
As for sale prices, there was a general downward trend, with BH as the exception, reflecting a new market dynamic marked by high interest rates and demand adjustments.<\/p>\n\n\n\n
Profitability by city<\/strong><\/p>\n\n\n\n The study shows high total gross returns across the capitals:<\/p>\n\n\n\n Top neighborhoods by total return in each capital:<\/p>\n\n\n\n “While it’s important to consider liquidity compared to financial assets, residential real estate shows robust performance and good return expectations over the medium and long term. Inflation protection, regular income from rent, and potential appreciation reinforce its strategic role as a complementary investment alternative,” says Andr\u00e9 Braz.<\/p>\n\n\n\n Toward a more efficient and competitive market<\/strong><\/p>\n\n\n\n According to the researchers, estimating returns in the residential real estate sector helps understand the impact of economic factors like inflation, interest rates, and construction costs, and supports better public policies and investment strategies, contributing to a more efficient and competitive market.<\/p>\n\n\n\n “The study shows the sector is still below its full transaction potential due to limited credit accessibility. To make the market more inclusive and balanced, addressing the housing deficit is crucial. This can be done through policies that increase housing supply, especially in major capitals, and measures that expand access to real estate credit,” says Thiago Reis.<\/p>\n","protected":false},"excerpt":{"rendered":" Rental income combined with apartment appreciation reaches significant level in 2024, researchers show. The percentage, which considers three capitals (S\u00e3o Paulo, Rio, and Belo Horizonte), surpasses other market investments.<\/p>\n","protected":false},"author":2,"featured_media":56,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[6],"tags":[],"class_list":["post-55","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-data-insights"],"acf":[],"yoast_head":"\n\n
<\/li>\n<\/ul>\n\n\n\n\n
<\/li>\n<\/ul>\n\n\n\n