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Proceeds To Buy Properties In Brazil

02/04/2009

1) Can foreigners buy or rent Real Estate Property in Brazil?
Yes, we can. Foreigners are permitted to buy, own and rent Real Estate Property. By law Brazilians and foreigners are on almost equal footing when it comes to property ownership and tenant rights. Non-Brazilians are subject to certain limitations dictated by national and security interests. Foreign Governments can't own Real Estate Property except buildings and properties used for consulate or embassy sites.

2) What documents do I need to buy or rent property in Brazil?
Your travel passport is usually enough in order to sign a rent lease agreement. To buy a property CPF (Cadastro das Pessoas Físicas) is also required. CPF is easily obtainable by foreigners. In order to purchase real estate in Brazil, foreigners need to obtain a Tax Identification Number, known as CPF (Cadastro de Pessoa Fisica) in Brazil. CPF is issued by the Brazilian Federal Revenue Agency (Receita Federal do Brasil). To get a CPF you need your birth certificate that must be translated into Portuguese by a certified translator and legalized by the Brazilian consulate in your country of residence. The CPF number can be assigned to you the very next day. It will take about 2 months, however, for your CPF card to be mailed to your local address in Brazil that indicated in the form. You must have a Brazilian address as they will not mail CPF cards internationally.

3) Who can I use as a rental/real estate agent?
There are numerous business establishments and licensed individuals who can offer your services of apartment rental brokers or for sale property listings.
Administradoras - Business specializing in administering RE properties for individual owners or condominiums.
Imobiliárias - Essentially Real Estate Agencies
Procuradores - (Real Estate Brokers) Businesses specializing in locating desired properties.
All these businesses can be found in local Yellow Pages under Administração de Bens, Administração de Condomínios, and Imobiliárias. Needless to say, references and direct referrals can save you from unscrupulous operators. In case of untried and unknown agent you might want to verify that the individual or business you are dealing with are members of CRECI.

4) Can I lose the rights to my property?
Yes, under certain circumstances you can.

5) What is a Registro Imobiliário?
Registro Imobiliário is the statute of Real Estate Property. In order to claim possession of a Real Estate Property you have to register the transaction of property ownership transfer at Registro Imobiliário. Usually takes place at Cartório do Registro de Imóveis located in the same jurisdiction as the property, but can also be conducted at any location by an authorized official.

6) What is the extent of the degree of publicity about ownership of property in Brazil?
It literally means that anybody can have access to property ownership information without any reason or authorization.
7) What is Matrícula?
Matrícula is the passport of a Real Estate Property; the only legal relationship between the property and its Matrícula is one-to-one. Besides uniquely identifying a property, Matrícula contains detailed description and historical records of all legal, judicial and financial transactions pertaining to the property and full information, such as description of the property, its precise address and location, past and present owner information, mortgages etc.

8) Do all Real Estate Properties have Matrícula?
No, not all of them do. Only properties that were constructed or involved in some type of legal or financial transactions since December 31, 1973 have one.

9) What happens if the property was altered through construction or natural causes and doesn't correspond to the description contained in Matrícula any more?
Property description needs to be changed through a judicial process called Processo de Retificação. Unless you are willing to plunge into legal quagmire, verify that the property description contained in Matrícula corresponds exactly to reality. To be specific, you buy what is on the paper, not the RE property itself. What documents do I need to request from property seller before considering buying a property? At a minimum the documents you should ask for are: Copy of Certidão de registro da Incorporação no Cartório de Registro de Imóveis. Copy of Convenção de Condomínio. Copy of License of Construction (Alvará). Copy of Architectural Plan of the construction approved by the Mayor's Office.

10) What do I need to do when I find a property that I'd like to purchase?
Check for Matrícula of the real estate property. Matrícula is a document that contains information about all transactions directly related to the property since its construction. IPTU values, owner information, ownership transfers… It takes about R$ 10 and three days to obtain a Matrícula through a local Cartório de Registro de Imóveis. Verify that the property is debt and lien free. In order to verify IPTU payment complacency check with Prefeitura by submitting the número do contribuinte (registration number) indicated in Matrícula do imóvel. Verify that the Condomínio fees are paid off. Any debts on the property can and should be taken into consideration during the negotiation.

11) How much should I give for a Sinal?
Sinal (down payment) can range anywhere from 5 percent to 20 percent of the agreed
value of the property.

12) What is an acceptable commission paid to the Real Estate agent for sale or exchange of a property?
The standard fee is 6 percent of the value of the deal (property). In case of property exchange, commission is usually split up between the parties involved. In sale, the seller pays.

13) How much should I pay domestic help?
Check the local market. Talk to people who have domestic help. Determine whether how much service you need and number of days per week that you may require it. If you can limit work hours to 6-8 hours up to three times per week, you can hire help as prestador de serviço and pay only agreed hourly or daily wage. Based on the availability and quality of domestic help and the amount of work daily rates can be as low as R$ 35 (US$ 15) and as high as R$ 80 (US$ 34). Full time help should get paid at least 1½ minimum wage plus transportation and other expenses.

14) What Payroll taxes should I pay if I employ workers in Brazil?
Social Security tax: 20 percent Other Fees: 2.0 percent to 6.0 percent Labor Accident Insurance: 1.0 percent to 3.0 percent Severance Pay Indemnity Fund (FGTS): 8 percent (deposited monthly to employee's escrow account).

15) How much do I tip Porteiro?
Tipping is not big in Brazil. Though some places that deal almost exclusively with foreigners became tip oriented, the majority of establishments are not. Restaurants add 10 percent service fee to the check (BTW, it doesn't necessarily mean that the waiter gets it), hotel bell boys (men) would appreciate a REAL or two, the taxists are mostly getting by on rounding up the fare.


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Aditional information about Brazil



Foreign investment is encouraged and buying now could let you see huge returns on investment in a few years time - in some areas of North Brazil, property prices have increased by a massive 20% in the last few years alone. The places that have boasted the best growth so far have been in the area of Bahia, which is situated on the north east coast and is a tourist hot-spot thanks to fantastic weather, beautiful beaches and many development projects underway. São Paulo is predicted to see a big growth period as many international businesses are starting to setup bases there, which is increasing the demand for housing and amenities. However, be aware that the mortgage market is severely underdeveloped at present. At the time of writing, foreigners are unable to obtain a mortgage in Brazil so you will need to arrange some sort of financial backing in your own country. Mortgages to Brazilians are also fairly rare (approximately 50,000 were taken out in 2005), and the rates are not that favorable nor is there much choice. Interest rates are still dropping and banks are developing their products so it is likely in the future that mortgages will become readily available.

Investment property in Brazil offers a fantastic opportunity to property investors and overseas home buyers. Brazil is amongst the fastest growing and most sought after worldwide property locations. A return of 20% p.a. or more on some investment properties in Brazil are realistically achievable. This huge country will provide a fantastic lifestyle for those looking to emigrate permanently or indeed as a choice for a second home or holiday residence. Brazil is currently entering the early stages of what is likely to become a sustained property boom.

If you are looking for property in Brazil or perhaps for land investment in Brazil, we have conducted extensive research into the market to ensure that our Brazil selection offers you the best possible real estate opportunities in this buoyant market. Purchasing off-plan is the most efficient way to achieve a profitable return on your investment. “In 2050 Brazil will be the world's 5th largest economy” - Goldman Sachs Brazil is establishing itself firmly as a viable opportunity amongst worldwide property investors and, according to worldwide economists.

Brazil will be amongst the top five leaders of the world in the near future. Brazil is already making a name for itself as a new hot-spot for the world’s property investors, while there has recently been much media coverage on the merits of this emerging market. Brazil’s new property developments are generally accepted to be of high quality and competitive prices mean that Brazil can boast top quality property for a fraction of the price of property of far less caliber elsewhere in the world.


Brazil, officially the Federative Republic of Brazil (Portuguese: Brasil or República Federativa do Brasil, listen), is the largest and most populous country in South America; and the fifth largest in the world in both area and population. Spanning a vast area between central South America and the Atlantic Ocean, it is the easternmost country of the Americas and borders every other South American country except Ecuador and Chile (viz. Uruguay, Argentina, Paraguay, Bolivia, Peru, Colombia, Venezuela, Guyana, Suriname) and also France (the département of French Guiana).

Brazil was colonized by Portugal and it is the only Portuguesespeaking country in the Americas. It is a multiracial country with a population composed of European, Amerindian, African and Asian elements, more often mixed in the same individual than
separated into different communities. It has the largest Roman Catholic population in the world.The capital of Brazil is Brasília.

According to the Constitution promulgated in 1988, Brazil is a federal presidential representative democratic republic, wherein the President is both head of state and head of government. Currently the President of Brazil is Luiz Inácio Lula da Silva (Lula). He was re-elected on 29 October 2006, extending his position as President of Brazil until the end of 2010. One of the fundamental principles of the politics in the Republic is the multi-party system, as a guarantee of political freedom.

The administrative structure of the State is a federation; however, Brazil has included the municipalities as autonomous political entities making the federation tripartite: encompassing the Union, the States, and the municipalities. The legal system is based on Roman law. The Union's executive power is exercised by the government, headed by the president, who is elected for a fouryear term, and is allowed to be re-elected for one other term.

Legislative power is vested in the National Congress, which is bicameral. The deputies of the Chamber of Deputies are elected every four years in a system of proportional representation by states.

The members of the Federal Senate are elected for an eight-year term. The Ordinary Law making process requires the participation of the executive, which has a right to veto on new legislation, and has an exclusive prerogative of initiative of legislation on certain matters. Additionally, if relevant and urgent circumstances justify it, the executive may issue a "Provisory Measure," which has the binding force of the Law and comes into force immediately.


International Real Estates
Located mainly within the tropics, Brazil's climate has little seasonal variation. In southernmost Brazil, however, there is subtropical temperate weather, occasionally experiencing frost and snow in the higher regions. The North constitutes 45.27% of the surface of Brazil and it is the region with the lowest number of inhabitants. With the exception of Manaus, which hosts a tax-free industrial zone, and Belém, with the biggest metropolitan area of the region, it is a fairly unindustrialised and undeveloped region.

It accommodates most of the largest rainforest of the world and many indigenous tribes. The Northeast has one third of Brazil's population. The region is culturally diverse, with roots from the Portuguese colonial period, Afro-Brazilian culture and some Brazilian Indian influence. It is also the poorest region of Brazil, and has long periods of dry climate. It is well-known for its beautiful coast. The most important cities are Recife, Salvador and Fortaleza.

The Central-West has a low demographic density compared to the other regions, mostly because of the Pantanal, the world’s largest marshlands area, and a small part of the Amazon rainforest, in the northwest. However, much of the region is covered by Cerrado, the largest savanna in the world. It is also the most important area for agriculture in the country. The most important cities of this region are: Brasília (the capital), Goiânia, Campo Grande and Cuiabá.

The Southeast is the richest and most densely populated region. It has more inhabitants than any other South American country, and hosts one of the largest megalopolis of the world, whereof the main cities are the country's two biggest ones; São Paulo and Rio de Janeiro. The region is very diverse, including the major business centre of São Paulo, the historical cities of Minas Gerais and its capital Belo Horizonte, the third-largest metropolitan area in Brazil, the world famous beaches of Rio de Janeiro, and the acclaimed coast of Espírito Santo.

The South is the wealthiest region by GDP per capita and has the best standard of living in the country. It is also the coldest region of Brazil, with occasional occurrences of frosts and snow in some of the higher altitude regions. The region has been heavily settled by European immigrants, mainly of Italian, German, Portuguese and Slavic ancestry, and shows clear influences from these cultures. The most important cities of this region are: Porto Alegre, Curitiba, Florianópolis, Blumenau, Novo Hamburgo, Londrina, Caxias do Sul, Pelotas, Passo Fundo and Joinville.

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