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Thus the finance minister, Antônio Palocci, this week announced measures to encourage banks to lend to the depressed construction industry.
Housebuilding, currently running at around 90,000 completions a year, fell 9% in 2012 compared to the previous year, and the depressed construction industry has been a key factor contributing to sluggish economic growth.
With support from the Dutch government, Energiesprong dangled the carrot of secured long-term contracts for a market of up to 2.3m homes, and then asked a depressed construction sector what solutions they could come up with.
Precise figures on the falloff of construction in Afghanistan are difficult to come by, but those in the business say the impending American and NATO withdrawal has not only slashed military spending, but also depressed construction spending generally.
Billed as support for first-time buyers, it is likely to help the depressed construction industry more.This sort of mild populism is mostly harmless and understandable given the scale of the pre-announced spending cuts and tax increases that begin next month.
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The government also has shored up struggling banks exposed to Spain's depressed domestic construction and real estate sectors by successfully completing an EU-funded restructuring and recapitalization program in December 2013.
The consequence of this policy failure is a continuing downward spiral of more vacant homes, continuing declines in property values and home equity, depressed home construction, and stresses on homeowners who spend every penny of disposable income to keep their houses.
Home sales and construction are depressed relative to normal levels but rose substantially in early 2012 from the prior year.
New housing is stalling out, and non-residential construction remains depressed.
Even though single-family construction remains depressed compared with historical norms, the single-family vacancy rate is still high.
Few homes on the market and a depressed level of new construction will continue to support price increases, he said.
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