Tourism is a popular industry in Brazil, with the country hosting no less than 4.8 million visitors in 2009, and the property market is proving to be just as popular. And, despite being rather new on the international property-buying radar, this South American country seems to be ticking all of the right boxes for investors, holiday homers and retirees alike. A diverse landscape, rich culture, idyllic climate and affordability are just some of the reasons why British buyers have started flocking here – but property prices are the reason they are staying.
While the initial flood of interest in property in Brazil was from the investment market, buyers are now seriously looking for holiday homes and potential retirement destinations for the future as flight connections from the UK continue to improve. The flight takes around 11 hours though, so Brazil is not a destination to consider if you are after a weekend bolt-hole.
Though the Brazilian economy itself has been relatively well-managed, leaving the country with some currency reserves as the government saved during the good times, the effects of the global recession are still being felt. Association with US and other international businesses has hurt the economy, though certainly not to the same extent it has elsewhere in the world.
The popular carnival city of Rio de Janeiro boasts 45 miles of white beaches – including Copacabana – meaning that it is popular for sure-fire tourist lets. Meanwhile, Sao Paolo is the government and financial centre of the country and, being an 11-hour flight from the UK, promises good business lettings rather than residential.
However the best potential seems to lie in the northern beach resorts. The natural beauty of these areas has been complimented by a range of high-quality developments and inward investment, meaning that capital growth is on the up. But a purchase here isn’t all about money – some of the purest water and cleanest air in the continent has been found here, while the city of Natal boasts the highest quality of life, and the lowest crime rate, in the nation.
However it is the resort of Bahia which is attracting the most attention from UK buyers. Glorious beaches and an excellent climate compliment good value for money – a mix which many purchasers believe will pay dividends in the long run.
Brazil is perhaps one of the few emerging markets that allows foreign buyers to own both land and property in their own names on a 100 per cent freehold basis – making the buying process relatively straightforward. However, before you can buy a property in Brazil, you must obtain a CPF (Cadastro das Pessoas Físicas) number, which can be acquired via the Brazilian embassy in the UK for a small fee (around £10). Once issued, this tax registration number will enable you to open a bank account and apply for utilities, although, perhaps its main aim is to register the amount of capital that you are planning on bringing into Brazil. It also allows you to repatriate your funds should you decide to sell your property.
If you are buying a home that was built after 1973 it will come with a legal document known as a Matrícula. Similar to title deeds, this document lists a detailed property description, all previous owners, the boundary details, any outstanding debts and all legal, financial and judicial transactions relating to the property.
The purchase process in Brazil is relatively simple once you have obtained your CPF number, however it is crucial that you seek the advice of a good, independent lawyer. This is especially true if you are buying a resale home, as checking for clean title can be a complicated and painstaking process.
Once all of the relevant searches have taken place you will need to open a local bank account, as the purchase funds must be visibly traceable from the buyer’s bank account into the vendor’s. In addition, all monetary transactions will need to be registered as a foreign investment with the bank of Brazil, but this cost should be covered in your legal fees.
You will be required to pay a deposit of around ten per cent when you have had your offer accepted – although this figure can range from five to 20 per cent. The balance is paid on completion, and the entire process is overseen by a notary.
Even though all contracts are processed in both Portuguese and English, it is advisable to hire a translator if your solicitor isn’t fluent in both languages.
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