When talking to real estate developers in Belgium, it surprises me each time that they fail to acknowledge that price appreciation of Belgian real estate from 1980 until the financial crisis occured parallel with the entry of boomers into the labour force. In countries like Belgium an massive amount of women entered the work market and all people obtained higher educational levels than their parents. The quantity and quality of labour increased, total consumption rose and so did aggregated savings. These savings took in countries like Belgium the form of real estate investments and prices rose.
Those times are over in Belgium.
The trend of an increasing amount of woman entering the labor market stopped (saturation reached), educational levels are no longer going up (top has been reached), productivity is decreasing in Belgium and so are the aggregated savings. This has nothing to do with the crisis, it is a long term Trend that started in 2004 and it’s fundaments are the demographics and the massive immigration of people with extremely low added-value to the Belgian economy.
Which brings is to what is called demographic dividend; the major drivers of real estate growth.
Demographic dividend happens when (1) falling fertility lowers child dependency and (2) when the working age population (15-64) expends but (3) before the old age dependency starts to rise significantly.
Belgian lost it’s demographic dividend completely; on the contrary, the country is going into an area of demographic deficit; not only because of the above 3 drivers, but also because of the destructive immigration policies of Belgium.
Demographic dividend goes hand in hand with rising investment and accelerating growth; the Western world enjoyed demographic dividend for the last 30 years; but now the party is over, the benefit is exhausted; no new workers are entering the job market and a massive amount of long-living baby-boomers are retiring, aggregated savings are falling. In the Western world the new morale is “walk away from your mortgage, buy an iPad”
People who believe that in Western Europe the real estate prices will recover after the financial crisis are wrong; they forget the impact of the above described much stronger negative driver. The number of 20-44 year olds, who are the ones buying real estate and first-time homes will fall by 20% in the next two decades, even up to 30% in Belgium and Spain and … China (yes, China: the 1-child policy will have a very ugly impact on China soon), and even decrease a massive 40% in South Korea.
Brazil has a very healthy fat belly of new entrants in the labour market for the coming 20 years, their time to enjoy the stimulans of demograhic dividend.
Brazil is the country that will grow the most after the crisis, generating proportional employment. Today the country has the lowest unemployment rate since records started being kept. Unemployment stands now at 6,8% and employment rate will increase by 6,5% in 2010 with a further growth of 5,5% over the coming years. Brazilian industry optimism remains high.
Last April 962.000 jobs were created in Brazil, the total in 2010 should reach 2 million. These amounts are sufficient to serve the Brazilian youth who is arriving to the labour market.
In 1960 Brazil had the same population as Germany: 72.800.000. In 2004 Brazil had a population of 181.500.000 habitants, Germany 82.500.000.
Next year, in 2011, Brazil will have a population of 200.000.000, Germany 82.800.000.
In 2050, Brazil’s population will have grown to 260.000.000, Germany’s population will have decreased to 74.500.000.
The fear for unemployment stands on a record low in Brazil. If one takes 1997 as a 100 index, the index now stands at a record low of 84%. The number of people who answer that they “have no fear at all to be licensed” is 53%, same as in June. The number who has a “little fear” went down from 32% to 30% this month. And the number who says to have “a lot of fear to be licensed” went from 15% in May to 16% in June.
Unctad just published its 2010 World Investment Report.
The report reveals estimates for Global Economy with average annual growth of 5.7% to 6.2% between 2010 and 2012 for developing countries. The world GDP should rise by 2.9% this year and 3.3% in 2011; developing countries will reveal a growth lower than 2%.
Also interesting to read is that FDI in 2009 was impacted negatively by the increasing sales of foreign affiliates to domestic companies; Brazilians putting the money where there mouth is.
The state Santa Catarina was present on the WTTC and D/Araujo made this movie to present the state.
Still so many places to discover in this beautiful state.
Last month, the British agency Employment Conditions abroad published the 2010 report of the most expensive cities in the world for expats.
The study found that RIo de janeiro is now the most expensive city on the American continent, yes, more expensive than New York even. In 2009 Rio ranked on the 132th place, today it is on 28, New York stands on 29.
And also, the study is not comprehensive and targeted to expats. It includes food, (groceries and eating out), drinks, tobaco, services, clothing, electrical goods and “motoring”. It does not include accomodation, car purchase or school fees. This explains why also Brussels went up in the ranking (from 35 to 25).
But it does reflect a reality that prices in Rio are outrageously high, and have been for some time (I’ve been writing about this for awhile). Interestingly, though, Rio and New York were right next to each other on the list – Rio as the 28th most expensive city and New York (Manhattan) as the 29th.
To see the complete ranking of all cities, click here.
Uma vida prática e com muito estilo, é o que o empreendimento Le Jardin tem a oferecer a você e sua família. São três casas independentes cercadas pelo verde em um dos bairros com mais qualidade de vida de Florianópolis.
O empreendimento Moradas da Ilha, oferece a oportunidade única de morar em casas cercadas pelo verde em um dos bairros com mais qualidade de vida de Florianópolis.
