November 13, 2018 / 9:59 AM / a month ago

Brazil freezes part of housing subsidy program -newspaper

RIO DE JANEIRO, Nov 13 (Reuters) - Brazilian state bank Caixa Economica Federal has temporarily stopped extending certain new home loans through its “Minha Casa, Minha Vida” housing subsidy program in a blow to homebuilders and low-income consumers who rely on the program.

In comments to newspaper Valor Economico, the bank said it had stopped extending new loans in the so-called “bracket 1.5” of the subsidy program until the end of the year due to budgetary restrictions.

Bracket 1.5 offers loans on favorable terms to families earning up to 2,600 reais ($690) per month.

The move could impact real estate firms serving low-income clients such as Direcional Engenharia SA, Construtora Tenda SA, and MRV Engenharia e Participacoes SA , Latin America’s largest homebuilder.

Caixa Economico Federal did not reply to a request for immediate comment.

($1 = 3.77 reais)

Reporting by Gram Slattery; editing by Jason Neely

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