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The State itself redesigned the housing game by transforming housing credit into a financial product (SFI + securitization purchased with FGTS), creating a cycle that pushes prices up while lengthening terms (up to 420 months) and increasing the final cost for the generation that wants the most but can buy the least.
The narrative that young Brazilians “prefer to rent” doesn’t hold up in light of the data. According to a survey cited by Elementary Channel, 93% of Generation Z still dream of owning their own home, and 68% of people between 21 and 34 say they prefer to buy rather than rent. The problem isn't desire, but feasibility: the math simply doesn't add up for those entering the market in 2025.
The historical milestone of this process is 1997, when the Real Estate Financing System (SFI) was created.
What was once the State's direct provider of housing has become a financial engine: mortgages were transformed into bonds, purchased even with FGTS money, fueling a cycle that artificially raised the property prices.
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The practical result is a generation that wants to buy more, but ends up being pushed into renting.
How the rental generation was born
The SFI and securitization allowed banks to transform credit portfolios into securities sold to investors.
Between 2011 and 2016, Caixa Econômica Federal issued R$18,9 billion in bonds, and a significant part was purchased by the FGTS, a fund formed with workers' money.
This operation freed up resources for new financing, but at the same time, stimulated ever-higher prices, as available credit grew along with property values.
In practice, young Brazilians began to face more expensive properties, longer terms for up to 420 months and interest rates that, on average, are around 10% per year.
This means that the final cost of a property can double in three decades.
The financing model has become a barrier to entry, making purchasing unfeasible for a large portion of the working population.
The impact of the pandemic and rising prices
The 2020 health crisis worsened the problem. The cost of construction materials has skyrocketed by more than 50% in two years, with increases of almost 90% in steel and 88% in PVC.
At the same time, working from home increased the demand for larger homes and shifted demand to the countryside, which led to further increases.
Example cited in the study: São José do Rio Preto recorded a 136% increase in sales and 255% in launches in 2024.
Brazilian real estate inflation remained above the world average.
In 2024, real estate prices rose 7,7%, almost triple the global average (2,6%) and at the highest rate since 2013.
This appreciation, combined with expensive credit, widened the gap between the dream and the reality of generating rent.
Young people with no way out: owning a home is far away, renting is the rule
Statistics show the dilemma: 31% of Gen Z still lives with their parents for not being able to pay rent or buy.
Only 45% of young people between 18 and 34 years old say they are completely financially independent.
Meanwhile, those who rent see their income drain away: paying R$2.500 monthly for 30 years is equivalent to R$900, almost two apartments, but with no equity at the end.
Research reinforces this picture: 62% of young people believe that it is more difficult to buy property today than for previous generations.
Even so, 73% still dream of owning a home. What's changing is the way they try to get there: alternatives such as remote work abroad and generating income in hard currency (dollars/euros) are emerging as strategies to overcome local income constraints and build a down payment.
Speculation and empty properties
Another factor exacerbating the rental generation crisis is inventory retention. In São Paulo alone, there are almost 600 thousand closed properties waiting to increase in value, according to the survey.
Meanwhile, those who need housing are pushed to increasingly distant outskirts, where transportation and public services cannot keep up with population growth.
This phenomenon reveals how housing has ceased to be just an essential good and has started to be treated as a financial asset.
The result is an artificial shortage of affordable housing and the perpetuation of an inflated market.
In almost three decades, the Brazilian State has gone from being a house builder to becoming a organizer of a market that favors banks, funds and investors, while pushing millions of young people into the rental generation.
Even so, most still dreams of buying your own home, even if you need to look for strategies outside of traditional logic.
And you, do you believe that Brazil should review the use of the FGTS and change the way it finances the housing sector, or is the current model the only one possible to sustain the market?
Leave your opinion in the comments — we want to hear from those who have experienced this firsthand.
So, from 1997 onwards, we've only had four years of right-wing government; the rest was governed by the so-called socialist left, which defends the underprivileged. Analyze, impartially, without fanaticism or ideology, whose responsibility it is.
Simple; Building a house for the “poor” doesn’t get you votes…