Effects of increased credit in housing real estate production in the city of São Paulo - period 2005-2012

Abstract

This article aims to analyze the effects of mortgage policy promoted by Brazil’s federal government from the year 2005 on residential development production in São Paulo, about real estate costs and the share of population which can have access to mortgages to buy them. This analysis will be based in statistical data of population growth provided by IBGE, the evolution of the housing deficit according to the Ministry of Cities, the housing demand according to research from Caixa Economica Federal, cost indexes of real estate for sale by Fipe-Zap, data of mortgage from Abecip and sectoral entities acting as SECOVI. These factors indicate the expansion of population served by mortgage, but the increased availability of credit led to a significant increase in property prices and urbanized land, which paradoxically produces exactly the opposite effect for a significant portion of the population, the difficulty of eligibility to receive the mortgage because the gap between income and cost of real estate.