Evandro Correia Silva, expert and founding partner of Nero Perícias, talks about the relationship between real estate assets and property valuation and why this is essential for its expansion
CGI (Property Guarantee Credit), as home equity is known in Brazil – a loan option in which the customer uses a property as collateral – is growing in the country. According to a report prepared by Credihome by Loft, the Loft Group’s real estate credit platform, the volume of loans of this type increased by 78.7% from January to September 2022, compared to the previous year.
According to the survey, 54% of those interviewed who resorted to home equity took out a mortgage to pay off debts, while 28% sought the necessary resources in this way to invest in another property or renovate the current property . Meanwhile, 13% of people surveyed said they invested the borrowed money in their business, and 5% said CGI was an alternative to accessing quick cash.
At the same time, recent data from the IFE (FinanZero Loan Index) reveals that the three main reasons for taking out a home loan were: renovating the property (24.6%), paying off debts (20 .2%) and investing in your own business (18%). The survey looked at information from 404,000 users registered on its base in August last year.
In synchrony, the indicators of Abecip (Brazilian Association of Real Estate Savings and Credit Entities) also indicate the progress of the mode in the country. According to the institution, the value of the concessions has had a cumulative growth of over 80% in the last four years and presents positive prospects.
On average, the North American market moves $4 trillion (R$20.78 trillion) annually, while Brazil’s annual volume is about $14 billion (R$72.73 billion), according to a survey conducted by Economic value.
According to Evandro Correia Silva, expert and founding partner of Nero’s skill – a company that works with graphics expertise and real estate valuation -, home equity has a lot to grow in the country. “The mode [home equity] it is becoming popular with the entry of digital banks and fintechs focused on this type of operations, as well as the high interest rate scenario that Brazilians are facing.”
According to Silva, the property valuation it is essential for the expansion process of the real estate assets, as this is one of the stages of granting this type of credit. “It is from the valuation of the property that a financial institution can determine the value of the guarantee that the customer has to offer, thus establishing the ceiling it can offer”.
The founding partner of Nero Perícias points out that the valuation must be carried out on the basis of the procedures established in the ABNT standard (Brazilian Association of Technical Standards) Nbr 14.653, which establishes how a real estate valuation must be carried out throughout Brazil.
Source: Terra
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