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Why real estate prices hit 18-year high in the world

  • Camilla Veras Mota – @cavmota
  • From BBC News Brazil in Sao Paulo

Real estate listings on the street of the British city Lichfield

Credit, Andrew Boyers/REUTERS

photo caption,

Pandemic mixed at least three ingredients that made demand in the real estate market explode

The problem is not unique to the country, but a global trend – including in Brazil. And it is, in a way, a side effect of the covid-19 pandemic, which ended up mixing at least three ingredients that favored demand in the real estate market.

The drop in interest rates used to cushion the impact of the health crisis on the economy made financing cheaper. Lockdowns and travel restrictions favored the accumulation of savings by the upper classes, who were unable to travel or attend bars and restaurants. Remote work, in turn, has awakened in many people the desire to take care of the house, to live in a larger, more comfortable space, and even far from the chaos of big cities.

In the United States, the jump in home values ​​over the past two years has raised fears that a new housing bubble could be brewing – bringing back the bitter memory of the 2008 financial crisis.

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