Fip
eZap H
ouse
Ask
ing P
rice Index
Introduction
Housing is the most relevant item in household budget (32% in Brasil,
according to POF/IBGE)
Information on real estate prices is basic for proper functioning of the market
in any developed economy
On the other hand, building a property price index is chalenging
- How to compare different properties?
- How to obtain reliable information?
3
Fip
eZap H
ouse
Ask
ing P
rice Index
Introduction
Possible methodologies:
- Stratification
- Hedonic regression
- Repeat sales
Possible data sources:
- Advertising
- Mortgage applications/approvals
- Contracts
- Registry
Weighting:
- Unweighted
- Stock
- Traded houses
Countries that use advertising as primary source for RPPI: UK, Spain, Hungary, Austria, Romenia and Malta
Reference: http://epp.eurostat.ec.europa.eu/portal/page/portal/hicp/documents/Tab/Tab/rppi_handbook%20_combinedv1_0.pdf
4
Fip
eZap H
ouse
Ask
ing P
rice Index
Data source: Secondary apartments advertised online at ‘Zap Imóveis’ (www.zap.com.br) and other sources
Sixteen cities (300.000+ ads):
- São Paulo (since december/2007)
- Rio de Janeiro (since december/2007)
- Belo Horizonte (since april/2009)
- Distrito Federal (since august/2010)
- Fortaleza (since march/2010)
- Recife (since june/2010)
- Salvador (since august/2010)
- Santo André
- Florianópolis
- Niteroi
- Vila Velha
- Curitiba
- Vitória
- São Caetano do Sul
- Fortaleza
- Recife
Mix-adjustment: neighborhood + number of bedrooms
Weighting: Cell’s total income (Census/2000)
Index calculation: Median asking prices of each cell; 3-month moving average; sale and rental indices
Methodology – FipeZap Index
5
Fip
eZap H
ouse
Ask
ing P
rice Index
International Experience: Spain Asking x Transaction Price Indexes
6
Fip
eZap H
ouse
Ask
ing P
rice Index
Average price (R$/m2) per city January/2013
R$ 8.711
R$ 6.922
R$ 6.477
R$ 6.372
R$ 5.109
R$ 5.014
R$ 4.912
R$ 4.760
R$ 4.436
R$ 4.303
R$ 4.121
R$ 4.041
R$ 3.929
R$ 3.881
R$ 3.722
R$ 3.440
R$ 6.350
Rio de Janeiro
São Paulo
Niteroi
Brasília
Recife
Belo Horizonte
Fortaleza
São Caetano do Sul
Florianópolis
Porto Alegre
Santo André
Salvador
São Bernardo do Campo
Vitória
Curitiba
Vila Velha
Média Nacional
Fip
eZap H
ouse
Ask
ing P
rice Index
Long term house real price indices for Amsterdam and US (compared to São Paulo)
Long term house real prices
9
50
100
150
200
250
300
1890 1910 1930 1950 1970 1990 2010
Amsterdam (Herengracht)
São Paulo (FipeZap)
US (Shiller)
Fip
eZap H
ouse
Ask
ing P
rice Index
10
MoM Asking Price Change
FipeZap Composite (Sale; 7 original cities)
2,1% 2,1%
2,4%
2,1%
1,8%
2,1%
2,4%
2,7% 2,6%
2,3%
2,1%
1,7% 1,9%
1,6%
1,4%
1,1% 1,1%
1,5% 1,4%
1,2%
0,9% 1,0% 1,0% 1,0%
0,9% 0,8% 0,9%
1,0% 0,9%
0,0%
0,5%
1,0%
1,5%
2,0%
2,5%
3,0%
3,5%
4,0%se
t/10
out/
10
nov/10
dez/
10
jan/11
fev/11
mar/
11
abr/
11
mai/
11
jun/11
jul/
11
ago/11
set/
11
out/
11
nov/11
dez/
11
jan/12
fev/12
mar/
12
abr/
12
mai/
12
jun/12
jul/
12
ago/12
set/
12
out/
12
nov/12
dez/
12
jan/13
Fip
eZap H
ouse
Ask
ing P
rice Index
11
Recent Asking Price Real Change (%)
IPCA Adjusted; since jun/2012
5%
5%
4%
4%
3%
3%
2%
2%
2%
1%
-1%
-1%
-1%
-4%
-4%
-6%
-6%
Niteroi
Porto Alegre
São Paulo
Salvador
Rio de Janeiro
Fortaleza
São Caetano do Sul
São Bernardo do Campo
FipeZap Ampliado
Santo André
Recife
Belo Horizonte
Vitória
Vila Velha
Florianópolis
Brasília
Curitiba
Fip
eZap H
ouse
Ask
ing P
rice Index
12
12m Asking Price Change (%)
São Paulo and Rio de Janeiro (Sale)
44,1%
14,7%
29,0%
15,4%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%ja
n/0
9
mar/
09
mai/09
jul/09
set/
09
nov/
09
jan/1
0
mar/
10
mai/10
jul/10
set/
10
nov/
10
jan/1
1
mar/
11
mai/11
jul/11
set/
11
nov/
11
jan/1
2
mar/
12
mai/12
jul/12
set/
12
nov/
12
jan/1
3
Rio de Janeiro São Paulo
Fip
eZap H
ouse
Ask
ing P
rice Index
13
Asking Price Index City of São Paulo (Sale; % Change since january/2008)
161%
183%
172%
153%
119%
jan
/08
mar
/08
mai
/08
jul/0
8
set/
08
no
v/0
8
jan
/09
mar
/09
mai
/09
jul/0
9
set/
09
no
v/0
9
jan
/10
mar
/10
mai
/10
jul/1
0
set/
10
no
v/10
jan
/11
mar
/11
mai
/11
jul/1
1
set/
11
no
v/11
jan
/12
mar
/12
mai
/12
jul/1
2
set/
12
no
v/12
jan
/13
São Paulo 1 Dormitório 2 Dormitórios 3 Dormitórios 4+ Dormitórios
Fip
eZap H
ouse
Ask
ing P
rice Index
14
Asking Price Index City of Rio de Janeiro (Sale; % Change since january/2008)
197%
216%
192% 186% 180%
jan
/08
mar
/08
mai
/08
jul/0
8
set/
08
no
v/0
8
jan
/09
mar
/09
mai
/09
jul/0
9
set/
09
no
v/0
9
jan
/10
mar
/10
mai
/10
jul/1
0
set/
10
no
v/10
jan
/11
mar
/11
mai
/11
jul/1
1
set/
11
no
v/11
jan
/12
mar
/12
mai
/12
jul/1
2
set/
12
no
v/12
jan
/13
Rio de Janeiro 1 Dormitório 2 Dormitórios 3 Dormitórios 4+ Dormitórios
Fip
eZap H
ouse
Ask
ing P
rice Index
15
Highest and Lowest Median Asking Prices São Paulo – Sale (R$/m2 – Jan/2013)
Vila Nova Conceição Jardim Paulistano Jardim Europa Ibirapuera Itaim
12.100
10.139 10.090 9.916 9.764
Vila Carmosina Jaraguá Grajaú Vila Curuçá Guaianazes
3.147 3.134 3.132 2.948 2.750
Fip
eZap H
ouse
Ask
ing P
rice Index
16
Highest and Lowest Median Asking Prices Rio de Janeiro – Sale (R$/m2 – Jan/2013)
Brás de Pina Madureira Bangu Guadalupe Pavuna
2.413 2.401 2.292 2.267 1.913
Leblon Ipanema Lagoa Gávea Jardim Botânico
20.451
17.720
14.908 14.803 13.818
Fip
eZap H
ouse
Ask
ing P
rice Index
Number of households and persons per households (source: PNAD/IBGE)
Demand: Three reasons for increase
First: Demography
18
3,0
3,1
3,2
3,3
3,4
3,5
3,6
3,7
0
10.000
20.000
30.000
40.000
50.000
60.000
70.000
2001 2002 2003 2004 2005 2006 2007 2008 2009
Dw
elle
rs/ho
use
ho
ld
Nu
mb
er
of
ho
use
ho
lds
(x 1
.00
0)
Rented Owned Dwellers/household
Fip
eZap H
ouse
Ask
ing P
rice Index
Unemployment rate versus real wages (R$ in Aug/2012; source: PME/IBGE)
Demand: Three reasons for increase
Second: Labor market
20
Fip
eZap H
ouse
Ask
ing P
rice Index
Number of months needed to afford one m2 by typical (median) wage earner
Sources: IBGE and FipeZap
House prices versus Income
21
3,6
4,5
0,0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
4,0
4,5
5,0ja
n/0
8
mar
/08
mai
/08
jul/0
8
set/
08
no
v/0
8
jan
/09
mar
/09
mai
/09
jul/0
9
set/
09
no
v/0
9
jan
/10
mar
/10
mai
/10
jul/1
0
set/
10
no
v/10
jan
/11
mar
/11
mai
/11
jul/1
1
set/
11
no
v/11
jan
/12
mar
/12
mai
/12
jul/1
2
set/
12
no
v/12
Num
ber
of
month
s need t
o a
fford
one m
2
Rio de Janeiro
São Paulo
Fip
eZap H
ouse
Ask
ing P
rice Index
Price-to-income Average m2 and monthly household income ratio (selected cities)
Sources: IBGE and FipeZap
Fip
eZap H
ouse
Ask
ing P
rice Index
Price versus HH income Average m2 and monthly household income
Sources: IBGE and FipeZap
Fip
eZap H
ouse
Ask
ing P
rice Index
Price to income
Median HH income / average asking price per district - São Paulo (Sale)
Sources: IBGE and FipeZap; HH income: Census (2010) in R$/oct-2012
Fip
eZap H
ouse
Ask
ing P
rice Index
Median HH income versus average asking price per district
São Paulo (Sale)
Sources: IBGE and FipeZap; HH income: Census (2010) in R$/oct-2012
Fip
eZap H
ouse
Ask
ing P
rice Index
Average interest rate (% per year) versus average duration (source: Central Bank)
Demand: Three reasons for increase
Third: Housing credit
26
Fip
eZap H
ouse
Ask
ing P
rice Index
“Fair value” of real estate in São Paulo: rental yield versus real interest rate
Sources: Banco Central do Brasil and FipeZap
27
Bubble?
6,2%
5,8%
3,0%
4,0%
5,0%
6,0%
7,0%
8,0%
9,0%
10,0%
11,0%
jan
/08
abr/
08
jul/0
8
ou
t/0
8
jan
/09
abr/
09
jul/0
9
ou
t/0
9
jan
/10
abr/
10
jul/1
0
ou
t/10
jan
/11
abr/
11
jul/1
1
ou
t/11
jan
/12
abr/
12
jul/1
2
ou
t/12
Real interest rate (mortgages) Rental yield
Fip
eZap H
ouse
Ask
ing P
rice Index
% of average montlhy income needed to pay the installments for a 1 m2 mortgage
Sources: IBGE, Banco Central do Brasil and FipeZap
Affordability
28
4,2%
5,3%
2%
3%
4%
5%
6%
jan
/08
abr/
08
jul/0
8
ou
t/0
8
jan
/09
abr/
09
jul/0
9
ou
t/0
9
jan
/10
abr/
10
jul/1
0
ou
t/10
jan
/11
abr/
11
jul/1
1
ou
t/11
jan
/12
abr/
12
jul/1
2
ou
t/12
% d
o r
endim
ento
médio
mensa
l necess
ári
o p
ara
pagar
a p
arc
ela
m
édia
do f
inancia
mento
im
obiliá
rio
Rio de Janeiro
São Paulo
Fip
eZap H
ouse
Ask
ing P
rice Index
Relative difference from affordabillity in jan/2008
Source: FipeZap
Bubble?
29
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
jan/08
mar/
08
mai/
08
jul/
08
set/
08
nov/08
jan/09
mar/
09
mai/
09
jul/
09
set/
09
nov/09
jan/10
mar/
10
mai/
10
jul/
10
set/
10
nov/10
jan/11
mar/
11
mai/
11
jul/
11
set/
11
nov/11
jan/12
mar/
12
mai/
12
jul/
12
set/
12
nov/12
RJ SP
Fip
eZap H
ouse
Ask
ing P
rice Index
Relative interest: rent versus sale % of queries from Zap website
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
jan/1
0
abr/
10
jul/10
out/
10
jan/1
1
abr/
11
jul/11
out/
11
jan/1
2
abr/
12
jul/12
out/
12
Rent
Sale