February 13, 2020 / 3:27 PM / in 15 days

Sales of new homes in Brazil's biggest city to rise in 2020

SAO PAULO, Feb 13 (Reuters) - Sales of new homes in Brazil’s biggest city, Sao Paulo, are expected to rise around 10% in 2020, local housing union Secovi-SP said on Thursday, as the government pushes economic reforms and interest rates are at record lows.

In 2019, sales of new homes rose by 49.5% year-on-year in Sao Paulo, also Brazil’s richest city and largest market, to a record level of 44,700 units. Of that total, 45% belonged to the low-income segment, according to Secovi-SP data.

Homebuilders launched a total of 55,500 homes in Sao Paulo, the highest level since the start of the poll and 49.6% up compared with 2018, Secovi said.

“Interest rates are lower and there is political will to approve reforms and reduce bureaucracy,” said Secovi-SP’s vice president Emilio Rached Esper Kallas. “But we remain ‘down to earth’ because land here is getting more expensive and prices are likely to rise.”

Secovi-SP Chief-economist Celso Petrucci warned, however, the sector remains concerned about funding availability to popular housing program Minha Casa Minha Vida.

“Budget [for the program] this year is the same as in 2019, but we have doubts regarding 2021 onwards,” Petrucci said. (Reporting by Gabriela Mello Editing by Alistair Bell)

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