Brazilian developers post weak Q3 as cancellations rise again
Brazilian developers’ preliminary operating results for the third quarter were considered weak by analysts covering the sector. Data from publicly traded companies show a decline in new project launches compared with the same period in 2025, as well as in the year-to-date figures. Even the low-income segment, which serves the Minha Casa, Minha Vida (MCMV) housing program and had been sustaining new project volumes, recorded declines of 11.5% in the quarter and 2.9% year to date.
Mortgage surge puts Caixa on track to meet 2026 targets
Homebuilders see weaker results as sales slow, inventories rise
Developers post weak second quarter results
The low-income segment has remained resilient in terms of sales, which rose 5.1% in the quarter and 7.5% year to date, but a new development has emerged: an increase in contract cancellations.
“For the first time in a long time, we’ve seen cancellations becoming a concern,” says André Mazini, Citi’s head of research. Unlike homebuilders serving the middle- and high-income segments, which experienced a wave of cancellations in 2015 and 2016, companies operating under the MCMV program do not typically face significant cancellations. That is because financing contracts are transferred to state-owned Caixa Econômica Federal as soon as the customer closes the purchase, rather than only when the units are delivered.
Tenda’s cancellations reached 19.5% of gross sales, up 7 percentage points in one year. Plano&Plano’s rate rose to 25.1%, from just 8.2% a year earlier. At Cury, cancellations accounted for 15% of gross sales, an increase of 4 percentage points from the same period in 2025.
Homebuilders attribute the increase to a change in Caixa’s assessment criteria that has made it more difficult to approve financing under the MCMV program. Mazini agrees. “Caixa has changed its ‘modus operandi’; the interviews [for financing approval] have become much stricter.” In his view, this reflects prudence on the bank’s part. “It is behaving as a bank should, concerned about defaults and the quality of its loan portfolio,” he says.
Although delinquency in Caixa’s real estate loan portfolio remains under control, at 1.45%, the specialist says there are signs that more contracts are being renegotiated and having their repayment terms extended, which would explain the change.
This more restrictive approach is expected to continue in the coming months, but homebuilders’ sales teams are expected to adapt by selecting customers more likely to meet Caixa’s criteria, says Piero Trotta, Citi’s real estate analyst. “There could be an adjustment in gross sales, which may come in a little lower, followed by somewhat fewer cancellations. What happened in the third quarter should not happen again.”
Caixa denies making any changes to its policy. “Caixa has identified no evidence that would allow it to link any cancellations reported by homebuilders, or their performance, to the bank’s credit strategy,” it said in a statement. “Financing approvals have always been conditional on compliance with the technical and regulatory requirements and repayment-capacity criteria applicable to each customer.” The bank said its results reinforce its “strategy of sustainable growth in real estate lending.”
Despite these hurdles, the low-income segment continues to attract companies that traditionally serve middle- and high-income buyers. Moura Dubeux, Lavvi, Eztec, and Cyrela have all begun directing part of their projects toward the program. At Cyrela, 44% of the total sales value (PSV) of projects launched during the quarter came from MCMV developments under its Vivaz brand, compared with 27.5% a year earlier.
According to Mazini, the ban on online betting platforms, known as bets, should have a positive effect. “We spoke with Tenda shortly after the ban, and it has helped. People have more money left over to pay their home loans,” he says, noting that the decision, made in late September, did not affect the quarter’s results.
Homebuilders serving middle- and high-income buyers also reported results considered weak, but there were no surprises in this segment. Sales velocity has declined, and companies are holding back on new projects to prevent a significant increase in unsold inventory. New launches fell 32% in the quarter and 16% year to date, while sales dropped 26% in the quarter and 8% in the nine months through September.
Meanwhile, real estate companies’ stock performance has been positive, driven by expectations surrounding the presidential election. The Imob index, which tracks construction-sector stocks, rose 17.31% in the month through Friday (16). The gains were concentrated in the period following Flávio Bolsonaro’s (Liberal Party, PL) lead in the first round of the presidential vote.
“The sector’s share-price dynamics will be less tied to operating performance, at least over the next few months, and much more to the macroeconomic outlook and the election,” Trotta says.
Business owners and executives in the real estate sector are optimistic about a possible victory by Flávio, betting on fiscal adjustment that would lower interest rates and on the continuation of the MCMV program. “The social housing program is included in both candidates’ government platforms,” Mazini says.
In his view, Eztec delivered the strongest results among homebuilders serving the middle- and high-income segments during the quarter. The company signed a lease agreement with Itaú covering both corporate towers it is completing on Chucri Zaidan Avenue in São Paulo, a development that boosted investor sentiment. The expectation is that the lease will attract interest from real estate investment funds in acquiring the properties.
