We're going to talk about the plot, dynamic pricing, reviews, and perspectives.
The momentum of the plot is very much tied to the time in the real estate market, which in turn depend on the economic situation of the country and the city/neighborhood in which it is located.
Looking back over 2016 and 2017, the price of the land, have undergone the relevant settings. The recession has caused the fall of prices in general, there has been an increase of distratos of the units, which, in turn, have pushed the stocks of corporations, leading to the inevitable depreciation of property, which is the raw material on the basis of the real estate developers.
At that time, we have seen the price of land to fall, on average, 30% of São Paulo, and from 50% to 70% in Rio de Janeiro, for example. That's not to mention the flexibility in the negotiations at the shop with in-kind resources, and related to the approval and sales in the future. It was an odd time to buy plots of land in the city of São Paulo, brazil.
In 2018, the game began to be reversed on the law of the distratos, interest rates fall, the economy out of the depression, and the us presidential election, and the consolidation of a political-economic development, more austere. The figures in the sector have started to improve, the stock was falling, and the developers have less leverage, and the trust and confidence of the investors and the consumers coming back.
This year, the recovery in the real estate market is consolidated, with record-breaking sales and new releases. In the banks returned to give credit to the truth, and the lower interest rate, a variable, and it's very relevant in the real estate market.
In an environment of low interest rates, the demand for real estate increases. The buyer must save more to make up for the portions of the loans on real estate. And that naturally brings the developer to buy the land in order to meet this demand. And you don't have to stop there, for the investor who seeks more in return than fixed income securities is also going to the back of the property.
In other words, at a time when the economy is and the interest rates are low, and all sorts of the buyer/investor to appear on the market, ranging from multinational corporations having a home of their own, until the bottoms of both national and international pension funds, investors, individuals and developers.
Price field, in this moment, it has been a challenge as of yet. Unlike the labor and raw materials, which have the characteristics as close to a commodity with a price similar to indepentendemente of the location, in the field of land for the price, it is closely related to the demand, the location and the potential for construction.
A plot of land in the Itaim, for example, can cost up to three, four, five, or more, times higher than that of a plot of land in the Tatuapé for the same film. This is because the value of a location that is directly related to the amount of the cash flow and the people who run every day for it.
The potential for constructive you can create a distortion in the price. In São Paulo, the region in which we do business, and the New master Plan of the city, narrowed down a lot of the venues, with the potential constructive and meaningful the so-called “spindles”, which are regions close to the subway station, and bus lanes. It's no coincidence that in these places there is a great demand for land. This is in addition to the increased concentration of the major real estate developers in the city, the market is more resilient to increased competition for land in the time of crisis.
More recently, we have seen the major players in the market such as Eztec, # Of, and Trisul to come to the market to raise funds in order to expand its operations. This has led to rapid effects in the behavior of the price of the land in the last few months. The negotiations, which were a component of the exchange, or is involved in installments over, came to be in the money and in a short period of time. We have already seen, the prices of the plots in the axes, the most sought-after going up by as much as 100% over the past 2 years (ie: Itaim, Jardins, são paulo, Pinheiros), but there's still a lot of room for appreciation in the role of the crisis in which we live, in the recent past.
We are in a time where the price of land in the city will continue to grow. Know how to position itself in the market with high speed and efficiency is key. The RBR like to serve this market with “harvest”, a 10-land, in the background, which is essential for the diversification of the portfolio. Therefore, we will continue buying until the moment that there are still good investment opportunities in the city of São Paulo. We are very excited to be so for at least the next 12 months.
