Why Invest in Brazil Property

Why Invest in Brazil & Frequently Asked Questions

Why Invest in Brazil?

In comparison to many other destinations, Brazil is still relatively undiscovered in terms of its Real Estate potential. This offers a big potential for large capital gains through investing now.

The country has recently experienced a big boost in its popularity abroad, helped by its robust economic performance. It is one of the four largest developing economies in the world (the three others being China, India and Russia) and according to Goldman Sachs, by 2050, Brazil with be the world’s 5th biggest economy.

Brazil has a stable and democratic government, it is self-sufficient in oil and a leader in the development of renewable energy sources, such as ethanol and bio-diesel.

Lower interest rates and inflation are now under control. Several economists believe that within a few years, Brazil should have become a investment magnet. A Mortgage lending boom is expected and consequently, an increase in value of its Real Estate.

In addition, superb current exchange rates make it very cheap for Europeans to invest in brazil property. Its image is frequently associated with a casual and healthy lifestyle, friendly people, and a beautiful combination of rainforest, mountains and sea. As a consequence, tourism inflows have increased dramatically over the past few years with many major Hotel chains investing millions of dollars on exclusive developments, such as: Marriott, Club Med and Sheraton.

With almost 5,000 miles of coastline, Brazil is a prime location for oceanfront properties, and perhaps one of the safest countries - both from a geographical, climatic and political viewpoint - for a property investor looking at long-term appreciation. All of these factors lead many to believe that Brazil is on the cusp of becoming a major investment ‘hot spot’.

Summary of Key Investment Reasons

Year-round sunshine, with average summer temperatures of 27°C

Captial appreciation: in some areas in the north east of Brazil saw property price returns of 20%+ last year

Current favourable currency exchange, making it cheap for foreigners to invest
Brazilian economy surpasses that of many European Countries President Lula has brought both improvements and stability to Brazil, including a decrease in inflation to an all-time low.

Foreign investment is encouraged and there is no restriction, ownership is 100% freehold

In comparison to Europe, the cost of living is five times less. Property maintenance costs are very low

Increase of thriving industries, such as electric power and Regional jets, where they are the number one Global Producers! Expected to produce all of its own oil within the next year.

Great natural beauty with fantastic scenery and 7,000km of beaches

According to some economists, Brazil will be amongst the economic leaders of the future, along with Russia, India and China

Friendly nature of the Brazilian people. Vibrant cities with carnivals and music

Brazil is a peaceful Country and is not affected by political wars or terrorism

Frequently Asked Questions

Can foreigners own land or property?

There are no restrictions for foreigners to buy and sell residential or commercial property and the Brazilian authorities encourage foreign investment. There are some limitations or fees applicable for specific areas such as marine land, islands, agriculture and areas near Brazil’s international border

Is Brazil a safe country?

Brazil is no more dangerous than the main cities in North America or Europe. The often posed questions relating to safety and security are a myth. The bad press about gangs relates to those that operate within the slums of Rio and San Paulo. Generally most of the crime committed is between the gangs so crime against tourists is extremely rare. Being sensible and sticking to the main stream is the key.
The northeast of Brazil is regarded as being very safe and is 4 hours away from San Paulo. It is rare that you’ll see any aggressive behaviour from a local their generally very courteous.

What's the climate like?

Generally the daytime temperature is around 30 degrees and at night about 24 degrees even when it has rained! The average is approximately 27 degrees annually. Most of the time it is very sunny, the climate is dry and there is always a refreshing tropical breeze from the sea, which makes things seems rather pleasant.
The sea is also very warm and is approximately 26 degrees all year. Also Brazil does not have problems with tropical storms, hurricanes or earthquakes.

When is a good time to buy?

Well if it’s important to you to maximize the return and minimize the risk on your investment then the answer to this question is invest NOW! This is because peak growth hasn’t yet happened, but it will over the next 5 years, investment in new hotels, golf courses, resorts and condos should exceed R$4 billion (about US$ 1.8 billion) on the coastline of Natal, the equivalent to 8% of all foreigner investments that the entire Brazilian economy received last year. The area of Natal is set to become one the most popular tropical destinations for Europeans, and recently the Americans have opened their eyes for this area as well.

So with the property market still in it’s infancy and with prices as cheap as they ever will be, now is the time to get the best possible yield on a capital investment. If you’re looking for more certainty then professional property investors will tell you that once a country has announced the development of a major new airport, this represents a sure-fire sign that you’ll be successful in your investment. For those of you wanting a dream home in a stunning location at amazing prices, Natal represents an excellent opportunity.

What taxes should I be aware of?

We would advise talking with a tax expert because taxation varies within Brazil depending on where you are purchasing. Generally property transfer tax can vary between 2 and 6%, for example Natal is 3%. Capital Gains tax is 15%, unless reinvested into Brazil within 6 months. Annual property tax varies, for example Natal is 0.06% of declared property value per annum.

Do I need a solicitor?

Property is registered in Brazil via notary publics, under justice control. Each property can only be registered at one registry which stores the entire transaction history and physical identification of each property. This information can be viewed by the public and so many Brazilians buy and sell property without the assistance of a lawyer however it is recommended for a foreigner buying Brazilian property to get legal assistance.

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