Fulfilling the dream of owning your own property can be easier than you think. Today, the market offers different types of options and terms to acquire a property. This is especially true for financial planning.
Although financing is still the most popular form of payment, it is not the only one. We prepared this post precisely to talk about another option that is growing more and more in Brazil: the real estate consortium.
Now, do you know how a real estate trust works? Follow the post to find out:
-? What is a Real Estate Consortium -? Relevant data that proves that the real estate consortium is growing in the country -? The facilities it provides to help you acquire the property of your dreams
What is a Consortium and what is it for?
The consortium is a purchase modality. Basically, it is based on the union of people, whether natural or legal, with the purpose of creating savings for the acquisition of goods. The formation of these groups is carried out by a consortium administrator, always authorized and supervised by the Central Bank of Brazil.
The modality emerged in the beginning of the 1960s. With the growth of the automobile industry in Brazil, there was a lack of credit for the final consumer. Bank employees then formed a group to raise money for car purchases. This resulted in the formation of the first consortium!
In this system, the value of the asset is diluted over a period, and all members of the group contribute over this period. The contribution can be monthly, or as stipulated in the consortium contract. The administrator, then, by drawing or bidding, gives the value of the credit or the contracted asset, until all are met.
In the real estate consortium it’s the same thing. A group is formed and the value of the asset is diluted over a period. During this time, all members contribute and when the value of the item is reached, it is drawn to one of the members of the group. This happens until everyone in the group is drawn or has their own property.
Number of adhesions to the real estate consortium in Brazil grows in the 1st half of 2021
The real estate consortium is on the rise in the country. This is because this type of investment works as an alternative to traditional real estate financing. More than 37 thousand participants were awarded properties in the 1st half of 2019.
According to data from the Brazilian Association of Consortium Administrators (Abac), the demand for quotas in the real estate segment grew by more than 20% at the beginning of 2019. This indicates the possibility of real estate consortia reaching one million active participants in the country.
Between January and June of this year, there were more than 124,25 thousand adhesions. The average ticket of the real estate consortium, in June, registered the second highest index of the entire system of consortia, with a value of R$ 149.28 thousand reais.
The amounts made available in credits to the consortium members total R$ 3.77 billion reais. All this money was potentially injected into the housing market. In other words, there is a frequent growth in membership of real estate consortia, a high number of people being contemplated and an exorbitant amount of money being placed on the market, which shows a heating in the sector.
How can the real estate consortium help in the realization of the dream of a property or land of its own?
The purpose of the consortium, as well as the financing, is to obtain resources to acquire a good. The consortium methods, however, have some differences in relation to other types of credit acquisition.
The main difference from a loan, for example, is the time. Buyers who join a consortium will have to wait to have their own property. There is no forecast date when the resource will be available for purchase of the property.
In financing, the client borrows funds from the bank and then pays them back with interest. It is an individual and direct method, which brings enormous risks due to the high interest rate.
In the consortium, the group makes monthly contributions, determining the number of letters of credit that will be made available per month. This makes the dream of home ownership possible for each member, but only one at a time, because there is no money available for everyone at the same time.
The advantage is precisely the feasibility and diversity of payment terms and the flexibility in the use of credit. This gives the consortium participants a real possibility to obtain credit and even purchasing power in cash, without the costs of bank interest.
# Planned budget
In the financing, the installments can exceed the value of the family income, in the real estate consortium this can be adjusted. The quotas are usually values that fit the budget. Which, in turn, makes the consortium a valid long-term planning option.
In addition to being flexible, it allows the use of resources for different purposes. The letter of credit can allow the purchase of real estate, land, or even renovations. Also, it can be used to pay off real estate financing.
However, keep in mind that the money should be spent on what was planned. That is, it is no use paying the monthly fees and reverts the value to something that was not in the plans.
# Fees and Interest
Another important point to consider are the rates and interest placed on the modalities of obtaining resources. The consortium emerges as a great way to save.
The interest is lower than the financing, and the installments – as mentioned in the previous item – are planned to fit the family budget. The real estate consortium, therefore, is designed to have a lower financial cost.
Clients pay the management fee in the real estate consortium during the entire contract period. In financing, fees are paid annually.
In a hypothetical situation, the percentage of 12% to 22% that would be paid in a consortium, will have to be paid in 60 months. However, in a loan, approximately 9.5% of the average rate should be paid in just one year.
So, always be on the lookout and look for a real estate company that has a good portfolio. Besides, of course, seeking information about the administrators from the Central Bank.