A new ceiling for the purchase of real estate using FGTS resources was announced at the beginning of last week. In São Paulo, Rio de Janeiro, Minas Gerais, and the Federal District the ceiling changes to R $ 750,000.00 and in the rest of the country to R $ 650,000.00.
With this, the possibilities of real estate acquisition and financing for consumers are expanded. On the other hand, raising this limit may lead to pressure to increase prices. Thus, for those who are looking for property to purchase, the suggestion of caution is always reiterated to make a rational decision.
The acquisition of a property is always an important moment in life. But making this decision is not at all simple, which will have major repercussions on the buyer’s life. Therefore, any acquisition must be preceded by a reflection analyzing the positive and negative points. The hard part is making this reflection, because our emotional side, which wants to close the deal, tends to put the positive points in the foreground, which are also widely disclosed by the seller.
But, given the responsibility of this decision, one must also consider the negative points, in order to make, in the end, a conscious and rational decision, whether by the option to buy or not. To help, here are some considerations, from a financial perspective, to be taken into account when deciding to purchase a financed property:
(i) Firstly, the Brazilian real estate market is now largely supported by bank financing. The expansion of financing, as well as the extension of financing terms, has a largely positive side, as it facilitates access to the property and reduces the level of income required from the buyer.
But the other side of the coin cannot be ignored: a financing of 30 years (or more) corresponds to almost half of the Brazilian life expectancy, that is, it is an obligation that will accompany a huge portion of the buyer’s life, in which substantial part of your income will be compromised.
Therefore, the impact of this obligation must be very well evaluated, since any regret after the closing of the deal will have costs. Furthermore, another factor to be considered is that, in most cases, financing is post-fixed, so that the installments will be adjusted to compensate for inflation. Over a very long time horizon, this can have a big impact on the debt.
(ii) Interest and other charges are incurred on the financed amount. Then, when studying an acquisition, make your accounts using the effective values that will be charged (interest, taxes, insurance, etc.).
So, instead of being based only on the nominal interest rate, check what is the CET (Total Effective Cost), which is what really matters to your pocket. Often, CET tends to be substantially higher than the nominal interest rates disclosed in offers and advertisements.
(iii) In addition to the cost of the property, the accounts must also include the costs arising from the real estate documentation, which has a substantial value, and if not programmed, may burden the buyer. So, consider the expenses that will be made with the deed, ITBI (tax on the transmission of real estate), the cost of registering the deed in the real estate registry, real estate costs, bank documentation, insurance, among others.
Although these issues are boring, they must be considered to allow the purchase to be a rational decision, as it should be, and avoid headaches in the future due to unforeseen factors.
