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 ($2.3 billion) last year, up 20 percent from 2022. The result was due to the 10.6 percent expansion of the bank's loan portfolio to BRL 1.1 trillion. Around 65 percent of this portfolio is made up of real estate loans, which have more than tripled in the past year.
Background. Caixa's results and the Brazilian real estate sector as a whole have grown in recent years despite double-digit interest rates and high household debt. A robust labor market and new sources of financing offset the impact of the continued decline in Brazilians' savings.
- Last year, the loan volume for real estate purchases reached BRL 251 billion, the second highest result in the country's history, after only 2021.
- For the first time, the market's main sources of financing came from alternative instruments – such as investment funds and bonds – and the mandatory severance pay fund FGTS, from which workers can withdraw money in very specific situations, including for the purchase of real estate…
Fabiane is a former editor-in-chief of LABS (Latin America Business Stories) and has more than 15 years of experience covering business, finance, innovation and cities in Brazil. The latter recently brought her back to the classroom and earned her a Masters in Urban Management from PUCPR. At TBR, she keeps an eye on economic policy, disruptive companies and people driving innovation in Latin America.
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