- 1 Minute Read
- 15th January 2013
Rio de Janeiro slums: From ‘no-go’ to must buy
Falling crime rates in the favelas of Rio de Janeiro have transformed the city’s real estate markets, as it continues to draw worldwide interest in the run-up to it hosting the 2014 Football World Cup and 2016 Olympics.
The city’s shanty towns, once infamous as the dominion of armed drug lords, have seen their crime rates fall dramatically whilst commercial property prices have boomed.
Since 2011, police have been seizing back control of its lawless favelas from drug gangs, as part of its ‘pacification program’ to clean up its streets in time for the raising of the curtain in 2014.
The shanty towns have been transformed to areas now seen as extremely lucrative by property developers, with major investment pouring in from around the world.
SecoviRio, an organisation representing Rio’s real estate agents, estimated that within 72 hours of the police moving into three of the favela’s, property prices in the area jumped by 50%, and are still climbing.
Late in December 2012, controversial plans were announced by spokespersons for billionaire property tycoon, Donald Trump, who plans to erect the largest office complex in Brazil in in a once run-down port in the east coast of the city.
The plans are controversial as they will make thousands of occupants homeless as they have no legal claim to owning their shanty style homes and will be forced to leave. One soon to be evicted resident described how he returned to find his home ‘marked for demolition’.
He said: “It's depressing. Many people have fallen ill. Arriving home and seeing those letters and knowing that your house is marked for demolition is terrible."
There was also a highly publicised case of two European developers going to court over their rights to claim an old shanty building in one of the hill-side favelas in Rio.
In Vidigal, a favela in the South of Rio, Brazil’s middle-classes and foreigners who can’t afford property in its fashionable neighbouring areas are snapping up property between beachfront areas like Copacabana and Ipanema, - caused a surge in its property prices.
Anderson Ramos, a real estate agent with Vidigal's first real estate agency believes the connotations of a favela have changed: "But now, you say `favela' and they think pacification and good deals on houses."
Commenting further, Mr Ramos said: "It used to be you'd say the word `favela' and people would instantly think: drug trafficking, machine guns, grenades, kidnappings,"
"We're seeing upper-class people, millionaires, and famous musicians practically queuing up."
The news is likely to be welcomed by representatives of both FIFA and the Olympic Committee, who have staked the reputation of their respective international sporting events on the ability of the Brazilian government to transform some of the less savoury aspects of the capital in time.