Multifamily Rental Market in Brazil Expected to Grow by 31.5% by August 2025

Strategic Insights -

Brazil's multifamily rental market is expected to grow significantly by 2025, driven by institutional investors and new supply. The market currently comprises 9,200 apartments, with a vacancy rate of 21.26% in the second quarter. Institutional investors, such as Brookfield, are backing foreign capital to enter the market, which is expected to reduce the national average vacancy rate.

Key Takeaways:

  • The residential rental market for income, known as "multifamily," is expected to grow by 31.5% in the number of units by August 2025.
  • The sector currently comprises 9,200 apartments in Brazil, with 30% of units delivered in the past 12 months.
  • The market remains heavily concentrated in the state of São Paulo, which accounts for 89% of the units in operation.
  • 29% of multifamily assets are classified as A, 37% as B, and 34% as C.
  • Brookfield has been able to raise its rents above projections and charge up to 30% more than a typical rent for a similar unit.
  • Multifamily properties typically do not require guarantors, offer more flexible contracts than the typical 30-month lease, and provide "professional" management of the building, including maintenance services.
  • 65% of multifamily properties have a swimming pool, and 96% have a shared laundry.
  • 92% of multifamily properties have coworking spaces, and 87% offer bike rentals.
  • Small units are more common, with 37% of units less than 30 square meters and 47% between 30 and 50 square meters.

Statistics:

  • Average price per square meter for rent: R$169.03
  • Average rent for a 50-square meter apartment: R$8,450 per month
  • FipeZap index for July: R$55.96 per square meter for rentals in São Paulo
  • Multifamily vacancy rate in the second quarter: 21.26%
  • Percentage of units classified as A: 29%
  • Percentage of units classified as B: 37%
  • Percentage of units classified as C: 34%

Sources:

  • SiiLA (real estate consultancy)
  • Brookfield (foreign capital-backed multifamily rental company)
  • Planta Inc. (developer of multifamily units)
  • Luggo (subsidiary of MRV&Co group specializing in building assets for multifamily)
  • FipeZap (Brazilian real estate index)