Investors into the Brazilian real estate market will be heartened by the raft of positive news emerging from Brazil with regard to the economy, GDP growth and the boom in Latin Americas largest economy.

Second quarter real GDP increased 1.9% from the first quarter in figures released by the Brazilian Government. The data was released by The Brazilian Institute of Geography and Statistics (IBGE) and showed a reduced drop in GDP from last year causing Goldman Sachs Group Inc. and BNP Paribas to revise their 2009 GDP forecasts higher following the announcement.

Brazils predicted growth has now been revised upwards to 4%, according to a weekly central bank survey of 100 economists. This coupled with a prediction of 0.16 per cent contraction for the whole year has led the Brazilian Finance Minister Guido Mantega to state publically Brazil’s economy has rebounded from the global financial crisis.

Mantega went on to say Based on positive trends in industry, real estate, services and employment rates, we project continued growth in the Brazilian economy next year. The result of GDP growth in the second quarter is without doubt excellent news” said Central Bank president Henrique Meirelles. “It shows that Brazil has already come out of a recession.”

A major factor in the quick turnaround experienced by the Brazilian economy is a series of measures introduced by the Government to incentivise the domestic real estate market and construction industry. Minha casa, Minha Vida has been a huge success and has contributed to the 2.1 per cent increase in domestic spending over last months figures.

This programme has poured R$60bn into Brazils housing market and given that the construction industry accounts for 5 per cent of Brazils gross domestic product this scheme is giving a valuable boost to employment and earnings.

The Minha Casa, Minha Vida scheme will receive another 10 Billion Reais in 2010 from the Federal Government. Brazil has a housing shortage estimated at 8 million units and this scheme was bought in by the Government to provide affordable housing and to stimulate the construction industry downturn caused by the worldwide economic crisis.

The Brazilian economy is the latest, Group of Twenty economy to emerge from recession, following the French and German economies, which both posted growth of 0.3% in the same quarter.

Leslie Richards is a development consultant to Brazil land Invest and wrote this piece on the Brazilian economy and affordable housing sector. The author invites you to visit Brazil Land Invest for information about investing in Brazilian land in North East Brazil.

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