Housing conditions in Portugal and Brazil: differences and similarities

More and more Brazilian citizens are coming to Portugal in search of a better quality of life, security and new opportunities for their families. However, when they arrive in our country, they face the challenge of access to housing, exacerbated by high housing prices, a shortage of rental and purchase offers, and high interest rates in mortgage loans. And it's a problem that doesn't occur in Brazil, a country that happens to be one of the most affordable countries to buyreal estate. That's a big difference between the residential markets in Portugal and Brazil. But there is more: there is also more supply of new housing in Brazil, and the property requires professionalization in real estate, point out experts spoken to by idealista/news.

There are significant differences in the political, economic and social climate between Brazil and Portugal.

"Brazil is a country with different political, social and economic challenges, and this creates a number of uncertainties for Brazilians," explains Guilherme Carnicelli, a consultant, entrepreneur and lecturer specializing in real estate in Brazil. And although Portugal faces macroeconomic challenges from high inflation, rising interest rates and proximity to the war in Ukraine, it is still considered a good country to live in. "The feeling here in Brazil is that everything in Europe is not perfect. There is a sense that post-pandemic economic challenges, the issue of immigrants and the direct effects of conflicts in the region of Ukraine and Israel are affecting the continent. But Portugal still seems to us an oasis in front of this whole situation. And if you compare it to Brazil, it still has many positive aspects in terms of quality of life and security," adds Guilherme Carnicelli.

It is because of the instability in Brazil - among other reasons - that more Brazilian families are coming to Portugal. According to the latest data from the Foreign Affairs and Borders Service (SEF) - an organization that has meanwhile been dissolved - the number of Brazilian citizens living in our country has quadrupled in the last 10 years to 393,000, not including people with dual citizenship. What are the differences between the residential markets in Portugal and Brazil?

The main differences between the residential markets in Portugal and Brazil have been identified by the experts that idealista/news spoke to: from the supply of new housing to housing affordability, as well as agency services and investments.

The supply of new housing is more significant in Brazil, while Portugal is dominated by old and dilapidated housing. "The difference is clearly noticeable with respect to new products. Brazil has a lot of new construction and new projects, while Lisbon is dominated by old buildings with familiar architecture, historical and emblematic buildings," said Daniela Rebauta, Sales Director at Engel & Völkers Lisbon, and Margarita Oltra, Area Manager at Engel & Völkers Portugal. Guilherme Carnicelli also says that "the Brazilian market is still seeing impressive growth in the primary market, new developments and this brings some new elements and demand for different professionals." However, the quality of housing in Brazil is not uniform: "The quality of housing offered in terms of finishes and comfort is present in the higher social classes," says Simon Furtado Costa, a real estate expert in Brazil.

When he arrived in Portugal more than two years ago, young Brazilian Simon Furtado Costa notes that he was "surprised by the number of abandoned houses" he found. But there were some positives, too. He notes that he was amazed at the "small amount of noise in the streets." "I saw a lot of quiet electric cars on the roads and it was impressive. The efficiency of the local railroad road network also amazed me.

In Portugal, access to housing is difficult, while in Brazil it is easy

Access to housing in Portugal is a problem - and the problem is getting worse. In addition to the shortage of affordable housing on the market, which has led to rising house prices, the country is also facing pressure on purchasing power due to inflation and high mortgage interest rates. That's why MoneyTransfers has concluded that Portugal is the third most difficult country in the world to buy a home, according to a study that analyzed 56 countries.

While Portugal's house price growth outpaced income growth by 69% from 2015 to the second quarter of 2023, Brazil is doing the opposite and is considered the most affordable country to buy a home globally, according to the same study.

"In Brazil, we face a significant advantage in terms of finding homes to buy or rent. This is due to the variety of options to suit different needs and budgets, while there are a number of government programs and financial support offered by banks to help people buy their own homes or rent them," emphasizes Simón Furtado Costa.

A young Brazilian who follows the real estate market is worried about high housing prices in Portugal because he has a "dream" to buy his own home in the country. "I face the problem of house prices in Portugal, which often require a significant contribution, such as 20% or 10% of the value of the property," he comments, emphasizing that "finding my own home involves a difficult financial balance, but I am determined to make this dream a reality here in Portugal," where he wants to continue living.

Real estateagency is more developed in Portugal.

For Sandra Canelas, partner at Remax Homes & Properties Brasil, the main difference between the residential market in Portugal and Brazil is "the development, both professional and personal, of the real estate agent." "In Brazil, we are still struggling to qualify real estate agents, trying to create a culture of knowledge and understanding with personal meaning and professional development.... In Portugal, this seems to be more developed," notes the luxury real estate expert.

Carnicelli also argues that "in terms of operational dynamics, we are very similar because the institutional structures in Brazil were inherited from the Portuguese model during the colonial period. What is changing now is the maturity, above all in completed properties, the presence and representation of structured American networks, the work of partnerships between real estate agents is still relatively new in Brazil," he notes, pointing out that families tend to adapt to real estateagency models and even understand "the quality of service in Portugal as more professional".

Another difference between the markets is the fixing of real estate prices. "In Brazil, real estate values change according to the desire of the owners and are not based on any indexes or benchmarks. Creates a lack of transparency about the actual values of real estate sales, for example. In Portugal, probably because of the large number of foreigners, it seems clearer and more transparent," also notes Sandra Canelas.

Investing in real estate in Brazil and Portugal: risks vary

The opportunities for real estate investment in Brazil and Portugal are not limited, both markets are dynamic. However, the main difference lies in the risks of investing in Brazil, where the political, economic and social environment is unstable.

"The residential market in Brazil is very dynamic and varies from state to state and city to city. In addition, there are a significant number of investors who buyreal estate in different locations, inside Brazil and abroad," notes Francisco Quintela, partner at Quintela & Penalva | Knight Frank. On the other hand, "Europe is one of the most attractive markets for Brazilian investors, and due to various reasons [such as security] Portugal also attracts many investors and new residents with Brazilian origins," the expert adds.

"As for opportunities, there are certainly many in Brazil, but not everyone is ready to face the difficult entrepreneurship and the risks involved, perhaps this is one of the reasons for seeking Portugal," concludes Guilherme Carnicelli. Attentive and insightful, data journalism is one of Vanessa's most important interests. It's like she's playing music, putting words, numbers and graphs together in analyses of different areas of real estate without being fake. The sector has become more informed and better informed since she joined idealista/news in Portugal in 2021 with a northern accent. Responsible for idealista/news in Portugal since 2014, Tania is passionate about "reading" the world, exploring, anticipating trends and reporting what she learns, sees and hears, in the form of news. An award-winning journalist, she has more than two decades of experience in economic and financial journalism. Building a home based on attractive and quality information is her obsession.