Understand what changes in the new Minha Casa, Minha Vida – 07/13/2023 – Market

The new Minha Casa, Minha Vida sanctioned this Thursday (13) by President Luís Inácio Lula da Silva has a higher ceiling for financing real estate, more subsidies and lower interest rates. Created in 2009 and extinguished in 2020 —when it was replaced by Casa Verde e Amarela, from the government of Jair Bolsonaro (PL)— the housing program expands the number of beneficiaries and will heat up the national real estate market.

The Lula government’s objective is to finance 2 million properties in four years —555 thousand by the end of this year. Financing allows the purchase of new or used properties. In 2022, in the resumption of Casa Verde e Amarela on the eve of the presidential election, 380,000 housing units were contracted.

Families with a monthly income of up to R$ 8,000 are entitled to participate in the program. Informal workers can also finance, as long as they prove income through bank statements and income tax declaration.

What changes in the new Minha Casa, Minha Vida

REQUIREMENTS TO PARTICIPATE

1. Have a family income between R$2,000 and R$8,000 per month

• To calculate their income, the family must add up the monthly earnings of each member who will buy the property.
• No this sum includes assistance and social security benefits such as Bolsa Família, sick pay and unemployment insurance
• The preference is for the contract to be made in the name of the woman of the house. But husband, wife, children, siblings, relatives and friends who will live in the property can compose the income.
• Interested you can not: have a residential property in your name, have participated in another housing benefit program, be a Caixa employee, be part of the Residential Leasing Program and be registered with the National Registry of Borrowers

2. Prove that you will be able to pay the financing installments

• All financing participants must be over 18 years old, have proof of income and a clean name
• No You need to register for the program. Financing is provided by Caixa.
• My Home, My Life finance up to 80% of the value of the property. The remainder is the funding entry, which can be deducted with government subsidies and the use of the FGTS
• The installments must be paid within 35 years
• The value of each installment can compromise up to a maximum of 30% of the combined income of the property buyers. For example, if the family proves income of BRL 3,000, they can pay installments of up to BRL 900 in the financing

FGTS

• The program allows the use of FGTS to buy properties worth up to R$ 350,000
• It is possible to use the FGTS of all financing participants
• The balance of the guarantee fund can be used for:

1. settle installments
2. Decrease the value of installments
3. Reduce the number of installments

RANGE 1 – families with income between R$ 2,000 and R$ 2,640

This income range had been extinguished during Casa Verde e Amarela. Interested parties who fit into this category can finance properties worth R$190 to R$264,000 depending on the city where they live or work.

Within the new financing conditions of the federal program is the reduction of 0.25 pp in the interest rates offered to families with income of up to R$ 2,640.

monthly family income	Interest rate for North and Northeast regions with FGTS	Interest rate for the Midwest, South and Southeast regions with FGTS
BRL 2,000	4%	4.25%
BRL 2,640	4.25%	4.50%

RANGE 2 – families with income between R$ 2,640.01 and R$ 4,400

People in this income range can finance properties worth up to R$264,000. With the expansion of the range, families left Range 3 and will pay lower interest rates in Range 2.

monthly family income	Interest rate of installments for the North and Northeast regions with FGTS	Interest rate on installments for the Midwest, South and Southeast regions with FGTS
BRL 2,640.01 to BRL 3,800	4.75%	5%
from BRL 3,800.01 to BRL 4,400	6.50%	6.50%
BRL 4,400.01 to BRL 8,000	7.66%	7.66%

RANGE 3 – families with income between R$ 4,400.01 to R$ 8,000

Among the main novelties of the new Minha Casa, Minha Vida is the expansion of the ceiling for families with income of up to R$ 8,000 to finance a property using the guarantee fund.

The highest value of the property to be financed for this range went from R$ 264 thousand to R$ 350 thousand.

The interest rate on the financing installments across the country is 7.66% for FGTS holders and 8.15% for non-members of the fund —well below the rates of around 10% practiced by banks through the SBPE (Brazilian Savings and Loan System), the main line of credit for the purchase of real estate.

MAJOR SUBSIDIES

• Families who access housing financing through Minha Casa, Minha Vida with FGTS resources will have access to a greater discount offered on the down payment for the acquisition of the property
• For families with lower incomes, the government offers a kind of discount in order to help reduce the amount of the financing installments.
• The subsidy to complement the purchase of the property through the new Minha Casa, Minha Vida also increased: from R$ 47.5 thousand to R$ 55 thousand
• The limit has not been revised since 2017
• The value is defined according to population, social and income factors
• The program will subsidize properties that include Range 1 of up to R$ 170,000

Rural properties:

• For new homes, the maximum amount increased from R$55,000 to R$75,000
• For the improvement of a house, the value increased from R$ 23 thousand to R$ 40 thousand

PROPERTY PLANTS

The federal government determined new rules for the construction of housing units.

Minimum area:

• 40 m² for houses
• 41.50 m² for apartments

Properties

• Bedroom window with blinds
• Air conditioning in rooms

Common areas with:

• Balcony
• Library
• bike rack
• Equipment for sports practice

Location

The land of the property financed by Minha Casa, Minha Vida must be inserted in the urban fabric, with:

• Proximity to the complete urban infrastructure already installed and consolidated
• Access to public facilities for education, health and social assistance
• Access to commerce and services and collective public transport

LEGISLATION PRIORITIES

Minha Casa, Minha Vida will be financed by several sources and, when the money in the operation involves the Federal Budget, resources from the FNHIS (National Social Interest Housing Fund), the FDS (Social Development Fund) or the FAR of Social Leasing), priority will be given to:

• families where the woman is responsible
• families of which they are a part: people with disabilities, with autism spectrum disorder, elderly, children or adolescents with cancer or rare chronic degenerative disease
• families in situations of social risk and vulnerability
• families in an emergency or calamity situation who have lost their homes due to natural disasters
• families involuntarily displaced due to federal public works
• homeless families
• women victims of domestic and family violence
• families residing in risk areas
• traditional peoples and quilombolas

Contracts and registrations of properties financed by Minha Casa, Minha Vida will be made primarily in the name of the woman and, if she is the “head of household”, they may be signed even without the consent of the spouse, a general requirement provided for in the Civil Code.