LPS Brasil Consultoria de Imoveis SA

BOVESPA:LPSB3

Earnings Call Transcript 2020-Q4

[Operator]

Good afternoon, ladies and gentlemen, and thanks for waiting. Welcome to the conference call of LPS Brasil to discuss the earnings regarding the fourth quarter and year of 2020. Today with us are Mr. Marcos Lopes, CEO; Francisco Lopes Neto, the company's VP; Beatriz Machert, Investor Relations Officer; and Robson Paim, CFO. We would like to inform you that this event is being recorded. [Operator Instructions]

This event is also being simultaneous webcast on the company's website at ri.lopes.com.br. In there, you also have the respective presentation available. You will be able to control the slides. The replay of this event will be available soon after its closing. We would like to remind you that webcast participants will be able to post questions to LPS to be answered after the end of the conference call.

Before moving on, we would like to let you know that any statements made during the conference call relative to LPS business outlooks, projections, operating and financial goals are based on the assumptions and beliefs of the company management. Forward-looking statements are not a guarantee of performance. They involve risks, uncertainties and assumptions since they refer to future events and therefore depend on circumstances that may or may not occur. Investors and analysts should understand that general conditions, industry conditions and other operating factors may affect the future results of the company and lead to results that will materially differ from those expressed in the forward-looking statements.

Well, first, Mr. Marcos Lopes will make the presentation of the operational results. He will be followed by Mr. Francisco Lopes that will present the results of CrediPronto. Then Beatriz Machert will talk about financial results. And finally, Marcos Lopes, once again, will talk about the operating indicators and projections for '21. We'll finally open for the Q&A session. And that, we are going to turn the call to Mr. Marcos Lopes. Please, Mr. Lopes, you may start.

[Marcos Lopes, executive]

Good afternoon, everyone. I'd like to thank you for attending another conference call of LPS Brazil on Friday, the 30th of March at 1:06 p.m. live, where we are going to present the results of the fourth quarter and year 2020.

As was mentioned in the introduction by the operator, today, we have our VP, Francisco Lopes Neto; our IR Officer, Beatriz Machert; and our CFO, Robson Paim.

I would like to start highlighting that the fourth quarter of 2020 that reinforced a recovery in the real estate market that we had already mentioned in the previous quarter. Positive performance in company transactions both compared to the same quarter '19 and the third quarter of 2020. In the primary market, our own operations showed growth in transactions in the fourth quarter of 2020 compared to the fourth quarter 2019, that is year-on-year. Even with a considerable drop in the volume of launches because of the COVID-19 pandemic, that shows a greater operational efficiency and an improvement and the speed of our launches index.

In the secondary market, especially in our franchise segment, we also kept growth, with strong expansion in the transacted volume compared to the fourth quarter '19, which keeps motivated and confident with our strategy of national consolidation and strengthening of the network effect. CrediPronto, in turn, continued with excellent results, expanding the product coming from mortgages at higher levels than the market, consolidating its growth in market share in the segment.

In the fourth quarter, we also kept our efforts and commitment with the company's digital transformation process by means of the Lopes Labs. We strongly believe that we are moving consistently towards our objective of transforming Lopes in an increasingly digital company. The strengthening of Lopes Labs is crucial for us to be able to spread the vision throughout the company and create alignment, scale and efficiency in the entire Lopes ecosystem.

Our efforts to create the tri-match between consumers, brokers and properties, modernizing and improving the real estate experience and making Lopes brokers more efficient than the average in the market. Our pilots, tests, proofs of concept have already enabled us to see considerable improvements in indicators such as volume of organic visits, conversion rates of organic visits, generation of leads as we are going to see forward.

It's important to highlight that one of the main assets for this new phase in the company is our database. Our database has more than 9 million clients and approximately 265,000 single properties and they are all updated to information. In addition, we have a history of the thousands of real estate transactions in recent years. This huge amount of data, worked with artificial intelligence, enable us to have increasingly accurate algorithms to gain efficiency and intelligence in the whole real estate transaction chain. This is where we are going to focus our efforts, keeping our commitments with profitability and value generation to our shareholders.

After my first initial considerations, we are going to go to the presentation, and I'm starting with Slide #5 with the highlights for the quarter of 2020. So let's go straight to Slide #5. On Slide 5, we can see that the launches of the company amounted to BRL 8.7 billion, with the highlight of the fourth quarter that concentrated 43.7% of the total loans in the year equivalent to BRL 3.8 billion. The total transactions closed of the company reached BRL 7.3 billion. Considering all operations and franchises, own operations had a drop of 18% year-on-year, impacted by the restriction imposed by the COVID-19 pandemic. However, franchises kept the growth trend, with transactions 9% higher than that of 2019.

As for mortgage volumes in CrediPronto, well, they continued to show expressive growth, expanding or surpassing the volume financed in 2019 by 83%. The company EBITDA added up to BRL 58.8 million, 48% above the year of 2019. That's proof of growth of 13% in revenue and stability in cost and operating expenses when we compare year-on-year.

We also would like to make a point in highlighting Lopes Labs' outstanding role in the company's strategy. We'll always seek the best efficiency and balance between physical and digital world, providing the best experience possible to our clients and the best possible performance to our associated brokers, with that going and doing away with profitability and the generation of value to the company's shareholders.

Now we are going to go to Slide #7. In here, we talk about the launches for the 4Q 2020. As you can see on Slide 7, the first chart that you see on the left of the screen, we can see that the volume launched in the quarter was BRL 3.8 billion, a drop of 34% compared to the 4Q '19. This is still influenced by the impacts of the COVID-19 pandemic. However, the volume is a 28% increase compared to the previous quarter. The launches basically were distributed in the state of São Paulo that accounted for 91% of the total launch volume. Launches in the capital accounted for 79% of the volume in the state, in the metropolitan region. And in São Paulo inland, we had launches accounting for 9% and 12%, respectively.

To your right, we are going to see the impact of the restrictions that were imposed by the coronavirus pandemic, especially in the first half of the year. You see that 78% of the volume launched by the company was concentrated in the second half of 2019 -- 2020. The fourth quarter concentrated the highest volume of launches with 44% of the year total.

Going on, I'm referring to Slide #8. You can see on the slide, Slide 8, the results of our transactions. On the left, we have the company's consolidated results. That is including our own operations and also the transactions made throughout our franchises. Year-on-year, we had a drop of 8% but totaling BRL 7.3 billion in the period. Once again, this is an impact of the restrictions of the COVID-19 pandemic. When we compare quarter-on-quarter, that is this 4Q '20 with the 4Q 2019, we see an increase of 16% of the volume transacted by the group with a total of BRL 2.6 billion.

To your right, we see franchise operations with an increase of 9% in the annual volume transactions compared to 2019 with a total of BRL 3.4 billion. Also 28% up -- 20% up compared to the fourth quarter '19. It's worth highlighting that the volume transacted by franchises in 4Q '20, that is BRL 1.2 billion, was a new record, exceeding the previous quarter and anchored by hedge Lopes integrated system that continues to bring better and better results quarter-on-quarter. The group's own operations basically work in the primary market launches and grew 7% in transactions compared to the 4Q '19 with a total of BRL 1.4 billion. In the total of the year, there was a drop of 18% compared to 2019 in the total transactions. This is, again, a reflects of the pandemic and also of us revisiting launches with developers that decided to launch properties with a lower average ticket.

We'll now go to the next slide, Slide #9, where we are going to show you the result of transactions segmented by region and footprint. So again on Slide #9, we closed the quarter in 10 states and the federal district with 97 stores altogether: 18 our own stores and 79 franchises. You see that the state of São Paulo continues to be our main market with 73% of those transactions in 4Q '20. Year-to-date, transactions in the south region, particularly the Londrina operations continued to show good results and closed the quarter with 15% of the total. Other regions accounted for 19% of transactions of our own operations.

To your right, we have the breakdown of franchise transactions. São Paulo continues to be the largest area, with 60% of the total transaction in 2020, followed by Rio de Janeiro with 26% of transactions. Franchises in other regions of Brazil contributed to 14% of the total transacted.

Now we are going to Slide #10. I think here, we show our results of speed over supply and speed over launches. We are starting with São Paulo capital. We can see an increase of 5.9 percentage points in speed over supply. In comparison to the fourth quarter '19 and 3.7 percentage points in speed over launches compared to the same period, which shows better demand and good liquidity of the product launched.

Speed of our supply in the capital of the state of São Paulo reached 18.8%. Speed of launches, 22.4%. To your right, we have consolidated numbers. You can see growth, both on speed of our supply and speed over launches, the latest with the more expressive growth. We closed the quarter with speed oversupply Brazil of 13.4%, and speed of launches Brazil up 23.7%. These indicators show a more heated real estate market for launches.

Still on this slide, we can see the breakdown of transactions between recently launched products and product launched for more than 6 months. In São Paulo capital, the relevance of launches up to 6 months was greater, contributing to 75% of the speed of our launches transacted in the fourth quarter 2020 year-to-date Brazil with launches up to 6 months, they accounted for 61% of speed of our launches against 39% of the others.

Moving on, we are going to Slide #11. Here, we can see the company evolution and important indicators related to Lopes Labs along the year of 2020 last year. Visits to the portal and Lopes block grew significantly, 258% and year-on-year. And the fourth quarter 2020, you can see the results on the chart to your left. In the bottom part of the slide, we see an evolution of 0.34 percentage points in the comparison of the visits in leads, which is 32%, reaching a level of 1.4%. As a consequence of an increased number of visits to the portal and a better conversion rate, we can see, along 2020, an important evolution in the volume of leads originated by Lopes portal. If we compare the volume of leads generated between the fourth quarter 2019 and the fourth quarter 2020, we have growth of 339%, going above the 18,000 leads in the period.

Well, these were my initial remarks about the operational results. And now I'm going to turn to Francisco that is going to talk about CrediPronto. Then Beatriz is going to present the company's financial results. And after Beatriz, I'll come back to present, in the end, the indicators and projections for the year of 2021. Thank you very much, and now I'm going to turn the call to Francisco.

[Francisco Neto, executive]

Thank you, Marcos. Good morning, everyone. It is a pleasure to be able to present to you, as usual, the results of CrediPronto, both of the fourth quarter and the year of 2020, and then some comments about the projections that we have for the first quarter '21.

Well, Slide #13. If you go to the left upper part, we have key indicators, almost BRL 3 million in mortgage volume of 2019. The origination volume is above 83% compared to the previous year. We have, in the total mortgage volume of 2020, more than 9,000 new contracts, that is plus 81% compared to 2019. The quarter was also very interesting in terms of volumes, and we can see the chart in the bottom part to the right, you see the mortgage volume in the fourth quarter of BRL 1,066,000,000, which is almost 2.2x above the previous year and also above the third quarter of 2020. So these are our expectations. In terms of mortgage volume for '21, this amount of BRL 1,066,000,000 should go to BRL 1,004,000,000 million for '21, which will give a mortgage growth of more than 31% comparing the fourth quarter '20 and the first quarter of '21 in terms of our expectations of mortgage volume.

In the slide also, interesting to note is the growth of mortgage in CrediPronto of 86% in the year is above market average. If you take a look at the lower left portion, we see here the average of the market that grew 60% year-on-year. And CrediPronto, as I mentioned, 86%. In the upper right corner, we have the profit sharing recognition in association with Itau, and you have gross revenues in the year of 2020. Remember, we've received 40 days after the end of the month, then we have profit sharing from December '19 until November '20 with BRL 52.3 million. In addition, we have BRL 27.9 million coming from correspondent banking, which altogether gives us total revenues of BRL 80.2 million.

On the next slide, we have the evolution of our portfolio, which is also very important results because it is the portfolio that enables us to have a profit sharing. So we can see that the portfolio grew from December '19 to December '20 from BRL 6.14 billion to BRL 7.72 billion. That is growth of 26%. This is net growth. Remember that we already have the deduction of our prepayments. So these are things that are added every 3 months, as you can see. And the increases that we had from September to December, that is the previous quarter, the fourth quarter with growth of 9%.

We can also observe here already on Slide 15. How consistent our results are, if you think of the BRL 52 million profit sharing. Month after month, with one-off variations that can be explained by things that are more normative that we had in September, but quite steady results adding up to the BRL 52 million that I mentioned.

I thank you very much for the opportunity to be able to share with you the results of CrediPronto. And now I'm going to turn to Beatriz, our IR Officer, that is going to share with you our financial results. Thank you very much.

[Beatriz Lavieri, executive]

Thank you very much, Francisco. Good afternoon, everyone. We are going to start the analysis of our financial results on Slide 17 with the conciliation of our gross revenue.

Starting our own operations, we start with BRL 1.4 billion in the quarter and BRL 3.9 million in the year. As Marco presented, in the fourth Q '20, we had a reduction in the average commission of the company, basically explained by the increase of the participation of transactions in the economic segment as well as the businesses compacted by our Habitcasa operation. This impact is also observed in the annual commission that totaled 2.01% and expected because of the resumption of launches after the lock down in the first half of 2020.

After multiplication of the number of transactions by the net commission in the period, we get to gross revenues in transaction of BRL 28.4 million and BRL 78 million, respectively. This should be added to the revenues of other segments from royalty of franchises, BRL 4 million in the quarter and BRL 11.4 million in the year. Revenues coming from CrediPronto like profit sharing and commission up 1% recognized in the line of other revenues. To total the gross revenues in the period of BRL 59.6 million in the quarter, BRL 183.9 million in the year. We also have to add the relative value of the deferred revenues of upfront in CrediPronto.

On the next slide, to the left, we see that the company's net revenues totaled BRL 53.9 million with growth of 21% compared to the same period last year. Year-on-year, the variation of revenues was 13%, going from $147.5 to BRL 166.8 million. Analyzing that revenues by segment of operation, we see an expressive increase in CrediPronto's share that added with commissioning and profit sharing showed BRL 73 million. Thus, the share of CrediPronto increased considerably, going from 24% to 44% in the year. As a consequence, the participation of transactions on franchises added up to 56% with BRL 93.8 million in the period.

On the right, we see the total cost and expenses of the company, BRL 35.1 million in the quarter, growth of 11% compared to 4Q '19 and a total of BRL 180 million in the annual view is stable year-on-year. We had, in the quarter, an accounting of provisions for labor contingencies of BRL 11 billion. So that there was an increase of expenses in the quarter. This labor contingencies do not mean an impact of cash to our business. That since we were successful in several lawsuits, and the final result was significantly lower, I also say that the total contingencies that reached BRL 28 million did not surpass the annual budget of the company and shows a trend of drop because of the labor reform. Also, we kept the same level of expenses, although we did increase our revenues because of other adjustments related to social distancing.

Now I'm going to go to the next slide, comparing EBITDA and net income of the controllers. On the left, we see the company's EBITDA with BRL 19 million in the quarter, margin of 35%, with growth of 45% compared to 4Q '19. In annual views, the variation was 48%, increase of BRL 19 million, reaching BRL 58.8 million in the end of 2020. To your right, we have the net income before IFRS was increased most significant year-on-year, with an increase of BRL 8 million and final result of BRL 8.7 million, net margin up 5%. Those indicators are better basically because of the revenues coming from CrediPronto.

On the next slide, #20, we show the analysis of results by segment quarter view without the IFRS effect. Operationally speaking, the segments of franchises and CrediPronto showed a positive contribution with approximately BRL 21 million EBITDA. The transaction segment had a negative contribution margin because of the provisions for labor contingencies, as I mentioned in the previous slide, with an increase in the quarter expenses. After depreciation discounts, we had net income of BRL 10.4 million in the quarter, margin of 19% And after minority distribution, we got to the result of BRL 2 million for the controller shareholders.

On the next slide, we have the analysis of results by segment. The behavior of segments were similar to what we saw in the quarter, a strong contribution coming from CrediPronto with BRL 61.8 million of a total of BRL 58.8 million. Also the segment of franchising, keeping a positive contribution and reaching BRL 5.6 million in the period with EBITDA margin of 53%. Finally, the transaction segment had an EBITDA margin that was negative because of the combination of the instability of revenues and the pandemic. After discounts of depreciation, financial results and taxes, we get to net income of BRL 28.9 million in the year, margin of 17%. After payout of minority tariffs, we have the final result of BRL 8.7 million to controlling shareholders before IFS.

On Slide 22, we have the main IFRS effect on our results. The main impact are because of reassessment of shares in controlled company subsidiaries. We had, in the period, an accounted impairment of BRL 3.2 million in our Campinas operation. Also, we have the financial result with a negative deterioration of BRL 9.7 million in the period because of variations in the recording of calls and puts. The total impact was BRL 13.8 million without any cash effect for the company. Therefore, we recommend analysis of our numbers to just consider those impacts to better understand the company results.

Finally, on Slide 23, we have cash generation in the period and total availabilities in the end of the year. On the left, we have cash generating from operating activities positive for the fifth quarter in a row in BRL 19.6 million. As a consequence, we had the -- basically the contributions of CrediPronto. Thus, we closed the year with an increase of cash in our operations of BRL 48.7 million.

On the right, we see the variation of BRL 108.5 million in investment activities basically because of the accounting reclassification of BRL 78.4 million for financial applications investments and also the investments of the digital project, as Marcos mentioned, that is our priority. Finally, our funding activities added up to BRL 33.1 million, including amortization of the loan with Itaú in April last year, and minority distribution. Because we had the accounting reclassification, we have to analyze those lines to have a corrective view in the final variation of availabilities.

To close, we closed the year of 2020 with BRL 140.8 million in availabilities, a reduction of 9% in the balance of the year. These were my considerations about the financial results. And now I turn back to Marcos to talk about considerations for the year of 2021. Thank you very much.

[Marcos Lopes, executive]

Thank you, Beatriz. As we can see in the information presented in the year of 2020, we had a confirmation of inflection in company results. In 2019, we were basically steady and now we had profit in 2020, even with a pandemic scenario that affected the country's business environment as a whole last year. Still, we could show profitability and important operating gains in all the segments of operation.

We are optimistic about the company's future, not only because of the good momentum the real estate market is going through but also because of positive operational signs that we detected in the beginning of the year. So when I talk about the primary market, we have visibility of a launch pipeline of BRL 14.1 billion for this year, BRL 7.4 billion of which come from Lopes share in the respective developments. This estimate represents growth of 62% compared to the volume launched in the year of 2020.

Although the final decision of a launch for new projects is with the developer, the pipeline for this year already reflects a higher optimism in the market compared to the previous year. Based on this optimism we saw in the first quarter of '21, evolution of transactions in our own operations when compared to the same period 2020, getting to an expectation of BRL 750 million for the first quarter '21, which represents growth of 48%.

With regard to franchises, we observed growth of 68% in Rede Lopes transactions along the first quarter '21 compared to the same period 2020. The result was reached because of the consolidation of our franchise network, which enables us to have greater speed and provide better services to consumers basically in the secondary market.

In the CrediPronto operation, year-to-date, we recorded a launch volume 177% above that of the first quarter 2020 and 31% above the first quarter of 2020. Well, we believe the company is moving towards a scenario in which it will be possible for us to have increasingly more consistent margin gains, being able to capture the growth of the real estate market by greater operational efficiency and focused on technology to provide better service to our clients, buyers and enable our associate brokers to have even better performance.

I thank you all for joining us, and now we are available for any questions you might have.

[Operator]

[Operator Instructions]

Our first question comes from Alex Ferraz from Itaú BBA.

[Alex Ferraz, analyst]

I have 2 questions. The first is more with regard to CrediPronto numbers, transaction volumes, mortgage volumes that are very strong. You even gave some guidance in the material fact that the first quarter will probably hit another record. What do you think is going to be the mortgage behavior for the year, especially in a scenario in which we have a reduction of interest rates, the portfolio a bit better? What do you think the mortgage volume is going to be like in '21?

And also the data that you saw from Labs. If I'm not mistaken, this is the first time that you talk about lead generation and conversion. I would like you to comment about '21 if we continue to see this evolution, both in better conversion and lead generation. These are my questions.

[Francisco Neto, executive]

This is Francisco Lopes. Thanks for your question. I'm going to start answering with CrediPronto, and then Marcos can talk about Labs. As you very well put it, what I think is that we are in a moment now that the drop in interest rates that we saw that brought lots of buyers to the market was not still fully joined by the market, both in terms of real estate market as volumes in general. The drop was of 6 percentage points if you consider a longer period.

And just as a reminder, there is an expectation that every 0.5 point that -- percentage points that Selic drops, 1 million family can afford some kind of mortgage in a volume of 500,000 to 600,000 units. So you have an increase of families. You're talking about 9 million to 10 million families. And this has not still being fully enjoyed with this drop in interest. Today at the counter -- over-the-counter fee continues to be the same. It has not been changed yet.

And we still see growth of 31% quarter-on-quarter. If we consider our forecast in terms of volumes of BRL 1.4 billion in the first quarter, which is even higher than the growth that we had in the fourth quarter '20, which went from [ 24 to 31 ]. So because of all these factors, a huge potential with this drop in interest rates, I think that we are going to have very good mortgage volumes for the year. It's very difficult to say what the whole of the year is going to be. We already forecasted something for the first quarter, but I think it is all these dynamics that is going on and I think that will continue to be productive. Anyway, I'm going to turn to Marcos to talk about the Labs.

[Marcos Lopes, executive]

Thanks, Francisco. Alex, very good question, and thanks for giving me the opportunity to talk a bit more about Labs. This is something that makes us very excited about. You know that this is a priority for Lopes and we are really on the way of constant evolution. The data that we are talking about are the first deliveries. But clearly, along the year of '21, because everything that we are planting and working with will have very good deliveries to really reap the fruit of this initiative of others that really have robust technological base in the whole of the company. We really want to transform the company.

And as all tech companies, the input for you to be successful is data. And we have plenty of data. We have a huge amount of data. Data scientists are very happy in the company because there is plenty, and that will certainly will help buy our clients and brokers. I would like to mention that this artificial intelligence, the algorithms that are being created work very well in a fertile environment, that is if there is data for them to work with. Then machine learning understands and turn these algorithms to more and more powerful tools.

And the idea is to have the tri-match that I said, the right consumer, the right profile, the right broker. So in a scenario that I mentioned of 9 million clients that we have in our database and 160,000 properties, we are working on that, and we are really looking into our history of transactions along the years. You're talking about 50,000 transactions in last years that are being used as proxy for us to have even better algorithms and have machine learning and artificial intelligence working and BRL 50 billion transacted along the years, that give us the input for the intelligence to work so that we can narrow the distance between buyers, brokers with more efficiency and gains. So this is what we are doing, and I thank you very much for asking the question.

[Operator]

Our next question comes from Elvis Credendio from BTG Pactual.

[Elvis Credendio, analyst]

I also have 2 questions. First, about your guidance. If you could give us a bit more color in terms of region and segments. Is the pipeline concentrated in São Paulo or are you seeing a recovery of launches in other regions? And the second question, I would like to explore CrediPronto a bit more. I believe that the market benefits from affordability with lower rates. But as a whole, the real estate market is growing. If you think of CrediPronto's market share, do you think you can gain market share in your mortgage market, have even greater capillarity with the company? If you could share anything in this regard, I would appreciate it.

[Marcos Lopes, executive]

Okay. I'll start talking about the pipeline and then Francisco will talk about CrediPronto. Well, the pipeline. We do see an increase of launches in regions outside of São Paulo. More than half of the pipeline is São Paulo. But fortunately, we already see some cities like Londrina, something in the northeast, Fortaleza, we do see some increase. So we see the real market as a whole that is showing some similarity when we talk about the middle class.

From 2014 to 2019, the middle class was very much affected. The low-income market and the high-income market and the Minha Vida market didn't suffer as much. It was a bit less affected in these years. In 2019, with the market recovery, we start to see a recovery in middle class launches but very much focused in São Paulo, and that was a trend confirmed in 2020. In '21, we see a recovery of the middle class in other cities and other relevant markets. Campinas, for instance, we haven't had any launches for many years. And now we have a pipeline in Campinas. Campinas is not a capital city but it is a very relevant city in terms of size. So we see the pipeline happening.

Still not as high as we had from 2001 to [ '12, '13, ] but we see a reaction, which is excellent news. So to answer your question, São Paulo has the most of the launches in the pipeline, but we'll start to see a recovery from other markets. And we are very excited about that because we do believe this is just the beginning. We still have much to capture for the future.

And I would like to highlight that the pandemic is really hitting everyone, so everything is a bit on a halt. But we still have a lot in our pipeline, and we are seeing that just monitoring the pandemic for things to start moving. We are going to have the second digital initiative. We were the first company that started to have this digital sales. Now that we are having a second lockdown period, we are going to have the second initiative, but other launches that didn't happen last year and are starting to happen this year. As soon as this situation gets a little better, I'm sure that we are going to take off. Basically, we are ready to take off in all the different areas to really meet the repressed demand with good launches. Now I'm going to turn to Francisco to give an answer about CrediPronto.

[Francisco Neto, executive]

Thank you. Okay. You have a very good question. With regard to affordability, really, and the possibilities of credit for the future, I think that if we take a look at the volume that was mortgaged in 2020, you are talking about BRL 93 billion to BRL 94 billion for the acquisition -- financing acquisition, so plus BRL 90 billion.

If you consider that in 2014, for instance, which was a good period, the number was BRL 80 billion. And if you take into consideration that at that time, the interest rate was 9.5% and now it is 3.8% for you to take credit up to 420 months, in the past, it was 370. So we are going to see what happens with the installment of the property. So the example I gave you, [ 500,000 ], right? Now with these different rates and different times, you have an installment that is approximately, in the past, BRL 3,200 for this type of property, and now BRL 2,300, BRL 2,400.

So when you lower installments, almost BRL 1,000, you do impact the pyramid of affordability. That is the number of families that can have access to this property. And this is huge. We estimate 7 million to 8 million families that can join the game just because of this difference in terms of installment amount. And I'm comparing a very good year today and the expectations that we have in terms of interest.

So I think that in a way, this shows how much room we have to capture all the benefits from this drop in interest rates. And also, the counter fee that is -- the over-the-counter fee that is being used today is very appealing to any kind of debt. And you can finance up to 360 months and it is very appealing. Even for you to make swaps, that is -- you keep the amount and you have a longer period mortgage.

Another thing to consider is the expectation of Selic rate, the interest rate in Brazil going up, gives a sense of urgency, which also helps us with credit expansion. And touching your point in terms of future expectations, we believe that macroeconomic data is very important. But we -- all the signs show that we are going to have a very good year.

[Operator]

[Operator Instructions] We are now closing the Q&A session. I'd like to turn back to Marcos Lopes, the company's CEO, for his final considerations.

[Marcos Lopes, executive]

Well, thank you very much for attending our conference call to present our earnings for 2020. We are very happy with the momentum the company is going through with good results and with the confirmation of the first data from the first quarter that we are on the way to resume growth, having better margins and delivering good results backed by all the initiatives that we had in Lopes Labs that will bring a lot more efficiency to the whole of the company, with -- together with the results of CrediPronto that we are all celebrating the excellent results of a market that is growing. The mortgage market grew by 30% and CrediPronto outgrew this number. Thank you very much for attending.

[Operator]

LPS Brasil conference call is now closed. We thank you very much for attending and wish you a very good day. .

[Statements in English on this transcript were spoken by an interpreter present on the live call.]