Real estate is one of the more complicated investments you can do in Brazil. In this article, we will be looking at how to perform a real estate transaction and how to find high-value real estate prospects.
Brazil has a lot of real estates to offer, everything from beachfront resorts to metropolitan flats. Professional investors will also often look at farmland and rural areas.
Over the last 10 years, hundreds of thousands of foreigners have invested in property in Brazil. The highest concentration of foreign real estate investors has been in the North-East and South-East of Brazil.
Investors that bought real estate in the North-East have seen a dramatic devaluation of their properties. Many of the projects were developed at low cost but sold at American or European price levels by international realtors. Although the North-East of Brazil can offer beautiful landscapes, the reality is that the real price level for real estate in the North-East of Brazil is much lower than those in America and Europe as well as the South-East of Brazil.
The story has been very different for investors that bought real estate in the South-East of Brazil. The area is densely populated and the appreciation of real estate in this region has increased massively over the last 10 years.
Today you will find the most expensive real estate in Rio de Janeiro, a city that combines both access to the beach and a metropolitan touch making it a highly desired city for foreign investors looking to buy real estate for personal use. However, São Paulo is still ranked as one of the most attractive cities for real estate investments in the world and the most stable market in Brazil.
Buying real estate in the urban areas of Brazil is a relatively secure investment. Brazil has a safe and organized property registration system and a well-developed real estate market. However, there are some precautions and provisions to be taken so the deal will run smoothly.
According to Brazilian law, any foreign citizen can acquire urban property in Brazil. When it comes to rural areas, there are some limitations that we will discuss at the end of this article.
Although working with a licensed realtor you still need a trusted legal advisor to inspect documents and advise on the purchasing process.
The most obvious support is the inspection of documents and due diligence on the property deeds. Unfortunately, it is all too common to see foreigners being defrauded by unscrupulous sellers and realtors in Brazil. The most common cases include seller’s negotiating real estate they do not legally control, as well as selling real estate with outstanding debts.
It is also important to be advised on how to register the investment correctly in Brazil. There are no taxes on retrieving foreign investments from Brazil to abroad but this requires correct registration of the investment at the time that the real estate is bought.
And of course, it is also necessary to verify that the selected lawyer is legitimate. This can be done online with a service named Cadastro Nacional dos Advogadosprovided by the Brazilian Bar Association known as Ordem dos Advogados do Brasil. The service is unfortunately not available in English but you can search for lawyers based on name or OAB number. You are then able to verify the status of their license as well as see their photo.
When selecting a legal advisor you are not required to have a realtor involved in the transaction. From a buyer’s side, the realtor’s role is mostly related to advice about market offerings and price negotiations.
It is important to remember that realtors from a seller’s perspective, do not normally have exclusivity on the real estate. This often causes them to be defensive regarding both the address of the real estate, as well as the permission for the prospective buyer to take photos of the real estate.
As for the realtors’ registration, it’s almost the same process of consulting as the lawyers. However, there is no central database so it is necessary to consult the CRECI website for the state where the realtor is located.
During the process of acquiring a property in Brazil, the lawyer and the realtor will verify that:
- The real estate is properly regularised with the government bodies
- The seller owns the property they are selling
- The seller is allowed to sell this property
- The real estate is not on the mortgage or have any other responsibility
- The contract is according to Brazilian property law
The lawyer that is acting on your behalf will also give support on the process of payment and transfer of funds and monitor the transfer of the real estate to its new owner’s name.
Lawyers normally charge between 1% to 2% of the real-estate value for their services.
When buying real estate as a foreigner in Brazil there are two different sets of requirements in terms of documentation.
The first and often most challenging requirement is from the bank that will be responsible for clearing the payment. Real estate sellers often do not accept direct payments from abroad, therefore it is required to have a Brazilian bank account in addition to necessary documentation to register the investment in Brazil.
Purchasing a real estate in Brazil does not qualify for an investor visa to Brazil as a real estate transaction performed by a foreign is not registered as a direct foreign investment with the Brazilian Central Bank. To buy a real estate and obtain an investor visa in Brazil it is required to first establish a company in Brazil. A registered investment should then be performed into the company and subsequently, the company is used as the legal party in the real estate transaction.
Do not underestimate the time and complexity related to this step in the process. Getting the correct banking structure setup can take several months.
One tip is to contract a currency exchange bank and cash management bank separately. The currency exchange bank that clears the investment into the country take on some risks related to money laundry responsibility. Evaluating risk is a core skill for the currency exchange bank and they will normally provide faster responses and more detailed answers related to documentation requirements than a general-purpose cash management bank would be able to do.
For a foreigner to buy a property in Brazil the documentation requirements are relatively simple:
- Brazilian Taxpayer card is known as CPF
- Sworn translation of passport
- Registration at the National Public Registry of Deeds and Documents
If the transaction is related to a rural property, the foreign buyer must also present an identification card from Registro Nacional de Estrangeiros known as RNE. This identification card is only issued to foreigners with a permanent Brazilian visa.
For real estate transactions in Brazil the following types of taxes and fees need to be paid:
- Imposto Sobre Transmissão de Bens Móveis known as ITBI
- Real Estate Register Fee
- Escritura Pública de Compra e Venda which is a Public Deed Fee
- Imposto Sobre Operações Financeiras known as IOF
Since the management of real estate transactions is decentralized, the taxes and fees will vary from city to city. The only exception is IOF which is a Federal tax charged on the transaction of money to Brazil.
Some properties also have to pay a contribution named Laudêmio. It is typical for beachfront or other properties located near water to be subject to this charge due to historic reasons. The payment is managed by the Registry of the Federal Heritage, in Portuguese known as Secretaria do Patrimônio da União and a significant amount of the contribution is directed to the Catholic Church.
If the real estate is subject to Laudêmio, the rates range from 2% to 5% of the declared value of the transaction.
When it comes to the purchase of rural land by foreigners the laws differentiate the process for individuals and legal entities. The restrictions imposed on foreigners is intended to defend the integrity of the Brazilian territory and national security.
The National Institute for Agrarian Reform better known as INCRA estimates that around 0.51% of Brazilian territory is owned by foreigners. Their estimates are based on 34.371 rural properties and 4.3 million hectares of land owned by foreigners. Other institutes suggest that foreign participation in the ownership of Brazilian land is much higher, especially in some Amazon states like the Amazonas, Pará and Mato Grosso.
Only foreigners with Brazilian residence visas can acquire a rural property. The law does not specify if the residency is permanent or temporary, only proof of residence in the country. So foreigners that do not legally live in Brazil simply cannot buy rural properties in the country.
Foreigners that live legally in the country can normally purchase rural real estate in Brazil with the following conditions:
- Purchase of more than 1 property will only be allowed if authorized by the National Institute for Agrarian Reform
- The transaction does not exceed the percentage limits of land to foreigners properties in the Brazilian municipality. The foreign ownership is limited to 25% of the total rural municipality area and 10% of the rural municipality area owned by citizens from a single country
- The area to be purchased is not located along the Brazilian national border
Foreign companies authorized to operate in Brazil can only acquire rural properties if they develop agricultural projects in the country, industrial livestock or colonization, and such projects must be approved by the Ministry of Agriculture or the Ministry of Industry and Trade depending on the matter.
As for the area limits imposed, the foreign legal entity may only acquire rural property if the transaction does not exceed 25% of the total rural municipality area owned by foreigners and not exceed 10% of the rural municipality area that can be owned by citizens or companies from a single country.
Leaxcoin is a Brazilian blockchain startup that came up with a platform that provides a solution to all the problems with real estate transactions, either in the purchase, rent, lease, and real estate launch or in the property registry.
The entire platform environment is intended for local and global communities, with tools, applications, and solutions to full integration with registry, notary and government institutions, following the local jurisdiction for the transfer of title deeds.
The Leaxcoin platform is protected by blockchain, ensuring an unchangeable database. Know more about it here.
Brazil is one of the best places for investing at any time. From world-class beaches to highly-sough urban neighborhoods, Brazil is known as one of the best places to purchase real estate. Now, due to currency exchange factors and the higher purchase power of foreigners, this is even more of an opportunity than before.Can a US citizen buy real estate 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.Can a foreigner own real estate in Brazil? ›
If you intend to invest in real estate in Brazil, here are some tips. Any citizen can purchase urban properties in Brazil, including foreigners.Do you pay property taxes in Brazil? ›
Imposto de Transmissão de Bens Imóveis Inter Vivos (ITBI) is a property tax levied at the transfer of immovable property, with rates also varying based on the municipality where the property is located. The ITBI of up to 3% is payable by the acquirer on sales or transfers of real estate.
What Part of Brazil is Safest? Florianópolis, Brasilia (the country's capital), Curitiba, and Belo Horizonte are among the safest cities in Brazil, with some of the lowest crime rates in the country. Vacation destinations like Fernanda do Noronha are also quite safe.What should I know before moving to Brazil? ›
- Bem-vindo! ...
- Life is cheaper, but watch out. ...
- Get ready for an expressive culture. ...
- Health is a universal right – but going private is better. ...
- It's a gigantic country. ...
- The Amazon is wondrous – so go see it. ...
- Coffee is life… ...
- 8. …
By law, the Brazilian real (R$) is the only currency accepted in Brazil.Where do most Americans live in Brazil? ›
- São Paulo.
- Rio de Janeiro.
- Porto Alegre.
WHAT IF I WANT TO STAY LONGER THAN 90 DAYS? Beyond 90 days, you must request an extension with the Brazilian Federal Police. Without proper authorization, a fine will be applied and you will be subject to immediate removal from the country. Overstaying is considered unlawful immigration even if the visa is still valid.Can I collect Social Security and live in Brazil? ›
Generally, people who are not U.S. citizens may get U.S. Social Security benefits while outside the United States only if they meet certain requirements. However, under the agreement you can receive benefits as long as you live in Brazil, regardless of your nationality.
Children born in Brazil to American parents, except those in diplomatic or official status, acquire Brazilian Citizenship at birth as well as a possible claim to American Citizenship. They are dual nationals, and are required to have Brazilian passports to enter and leave Brazil.Do foreigners pay tax in Brazil? ›
Residents of Brazil are taxed on their worldwide income, and non-residents are taxed exclusively at source on their Brazilian-sourced income. The source of income is determined by the place where the income payer is located, irrespective of where the work is performed.Can I live in Brazil permanently? ›
The Permanent Visa (VIPER) in Brazil may be granted to foreign-nationals, who intend to live in the country for more than 2 years and are married to a Brazilian citizen or permanent resident, to retired persons who receive a regular pension, or to qualified employees or professors, scientists or researchers or to ...How much is the average house in Brazil? ›
The Brazil housing market is somewhat competitive. The average sale price of a home in Brazil was $139K last. The average sale price per square foot in Brazil is $69, down 11.0% since last year.…How much are closing costs in Brazil? ›
Understanding the taxes, and fees involved in property acquisition in Brazil is essential for a successful title transfer. Closing costs usually range from 6.5% to 7.5% of the property's price tag, excluding the legal fees and title insurance.Is living in Brazil worth it? ›
Brazil is a beautiful country filled with a rich culture and scenic landscapes. There is always something to do and see, providing many significant benefits to individuals considering moving to the South American country.How long can I stay in Brazil without paying taxes? ›
Legal residents of Brazil for tax purposes include: An individual who resides permanently in the country more than 183 days per year in Brazil in any 12-month period.Where do the rich in Brazil live? ›
It's Brazil's financial hub, flaunting the highest GDP in the nation and positioning among the best ten most costly metropolises to live in, in front of Milan, Paris, and New York City. São Paulo is a city of standouts, where the native mega-wealthy class has the limelight versus a milieu of absolute poverty.What is the cleanest city in Brazil? ›
What is the cleanest city in Brazil? The Municipality of Marau ranked first in the Urban Cleaning Sustainability Index. The research assesses, in accordance with the guidelines of the National Solid Waste Policy (PNRS), the way in which each Brazilian municipality disposes of solid waste.What is the safest state to live in Brazil? ›
São Paulo is the safest state at 14.3. On the other hand, Rio Grande do Norte is the most violent state and has a crime rate of 67.4. If you are looking for large cities that aren't too dangerous, Belo Horizonte and Brasília have the lowest crime rates.
- 1 Poverty and income concentration.
- 2 Crime in Brazil.
- 3 Education.
- 4 Infant mortality.
- 5 Housing.
- 6 Sanitation.
- 7 Health.
- 8 Environmental problems.
You can move to Brazil from the US as long as you have the correct visa in place. While US citizens don't need a visa to enter Brazil for tourism or short term business trips, if you intend to establish residence in Brazil you'll need to get your visa arranged in advance¹.Do Americans need a visa for Brazil? ›
Citizens of the United States do not require a visa to travel to Brazil for tourism or certain business-related activities.How much is $1 US dollar worth in Brazil? ›
1 USD = 5.168 BRL Feb 18, 2023 04:04 UTC.How much is $500 US in Brazil? ›
There is no limit on the amount of money any individual can bring into Brazil but if you're carrying R$10,000. 00 (ten thousand reais) or more, or its equivalent in cash, checks, traveler's check, currency or any combination thereof, you are required to declare this when you enter Brazil. This is not for tax reasons.How much money do I need to move to Brazil? ›
How much money do you need to live comfortably in Brazil? To live a comfortable life in Brazil, with going out and being able to put money into your savings, you need to earn at least $2100 USD/month, if not more.Is Brazil a good place to invest in 2022? ›
There exists a certain number of variables to be identified that turn Brazil into a favorable investment country in 2022: With still moderate interest rates (however bound to slightly increase in order to control inflation), significant returns and favorable currency exchange rate, 2022 appears to be the year to invest ...Is moving to Brazil a good idea? ›
Brazil's economy is growing at one of the fastest rates in the world. This can be seen in the vast improvements to infrastructure that are currently taking place, and in the buildings that are constantly being constructed. This suggests exciting things ahead for Brazil and makes this a great time to move to Brazil.How much does an average house cost in Brazil? ›
The Brazil housing market is somewhat competitive. The average sale price of a home in Brazil was $139K last. The average sale price per square foot in Brazil is $94, up 21.9% since last year.…
High costs of production (wages, credit, energy and logistics) Insufficiently developed infrastructure. High level of regulatory risk (high taxation and heavy fiscal system) High exposure to changes in commodity prices on international markets.What is the best investment in Brazil? ›
- Oil and gas. Brazil is a major player in the oil & gas sector and has the second largest proven oil reserves in the Americas. ...
- Agribusiness. ...
- Automotive manufacturing. ...
- Textiles/clothing production. ...
- Renewable energy.
Compared to many other countries, Brazil has a relatively low cost of living, which can be a major advantage for retirees on a fixed income. The warm climate and beautiful beaches are also a major draw for retirees looking for a more tropical lifestyle.What are two big problems in Brazil? ›
- Poverty and income concentration.
- Crime in Brazil.
- Infant mortality.
- Environmental problems.
- Threats to Democratic Rule.
- Freedom of Expression and Access to Information.
- Detention Conditions.
- Public Security and Police Conduct.
- Military-Era Abuses.
- Sexual Orientation and Gender Identity.
- Women's and Girls' Rights.
The Brazilian upper class comprises individuals who earn more than $727.87 monthly up to millionaires and billionaires, as defined by the Brazilian Institute of Geography and Statistics (Instituto Brasileiro de Geografia e Estatística, IBGE after its Portuguese acronym).What is the best part of Brazil to live in? ›
- São Paulo.
- Rio de Janeiro.
- Porto Alegre.
Retire in Brazil – Visas and Residence Permit
Americans can retire to Brazil on a retiree visa. To obtain a retirement visa, you must be over age 60 and have a pension that earns at least $2,000 per month. To apply for the retirement visa, you must apply at least four to eight weeks before arriving in Brazil.
|Monthly rent for 85 m2 (900 sqft) furnished accommodation in normal area||R$ 2,517|
|Utilities 1 month (heating, electricity, gas ...) for 2 people in 85m2 flat||R$ 618|
|Monthly rent for a 45 m2 (480 sqft) furnished studio in expensive area||R$ 2,577|
Similar to how Craigslist, Zillow and Trulia function, VivaReal connects buyers and sellers with properties for sale and rent.