Northeastern Brazil is a paradise for anyone in search of a relaxed lifestyle, low cost of living, perfect beaches, tropical climate and spectacular landscape - all seasoned with a large dose of culture, history and great food.
It is also becoming a hotspot for property investment as prices are still very affordable compared to other destinations.
Located only a few degrees south of the Equator, Fortaleza is one of the most popular tourist destinations in Northeastern Brazil combining city living (Fortaleza is the 5th biggest city in Brazil with 2.4m inhabitants) with a 573 km long coastline of staggeringly beautiful beaches.
The city is modern and boasts a very good infrastructure with a wide range of cultural attractions, good night life, modern shopping centres, good restaurants, bars and hospitals.
Whilst city centre property is available, mainly in high rise tower blocks ranging from pretty basic to those with extensive facilities, most people are lured to the Brazilian property market by the appeal of a more laid back lifestyle.
There are many projects for sale on the coastline around the smaller towns and villages approximately 60-90 minutes away from Fortaleza itself. These tend to be low-rise apartments, bungalows, townhouses and villas and prospective buyers should expect to pay a substantial premium for first-line beach properties.
The surrounding infrastructure does vary hugely - some coastal locations are simple fishing villages and others are more developed and have more to offer such as small supermarkets, pharmacies and internet cafes.
Before buying property in Fortaleza, it is crucial to decide whether you need to be surrounded by modern facilities immediately or whether you can afford to wait for an area to develop over time. It is highly likely that many of the smaller towns and villages will benefit from investment thanks to Fortaleza being one of the four areas to host the FIFA World Cup in 2014.
Purchasing and living costs:
- Buyers should put aside approximately 7.5% of the purchase price for expenses including 3% ITIV (similar to VAT); 1.25% notary office, 0.75% registration of the deeds, 1% administrative expenses, 1.5% legal fees.
- International lawyers are well versed at helping investors buy property abroad but due to the specific conventions in Brazil it is useful to hire a lawyer who has experience of the market there. They usually charge between 1 and 1.5% of the purchase price and will assists the buyer in applying for the compulsory CPF number and will undertake a number of important checks on the land and the property. They can also sign the final title deed on the buyer's behalf if necessary.
- There are no restrictions on foreigners buying Brazilian property and ownership is solid and secure. The buyer owns the land and property in its totality - similar to freehold in the UK.
- Brazilian mortgages are not currently available to overseas investors so all finance needs to be arranged in the UK. However when monies are transferred in to the country, they are registered at the Central Bank of Brazil to ensure that the Brazilian Government has recorded the investment into the country.
- Once a property is purchased, the owner may have to pay community fees (for general maintenance and upkeep) of between £40-£200, depending on type and size of property. There is also a yearly real estate tax (IPTU) paid on a Brazilian property that varies between different municipalities, and is typically between 0.5% and 1%.
- Income earned from Brazilian properties is taxable whether the investor is resident or non-resident in Brazil. Non-residents are subject to a capital gains tax rate of 15% on any gains they make on properties in Brazil.
Submitted by Alexander Wasastjerna at Brazilian Properties, - one of the leading Brazilian estate agents. Brazilian Properties carefully selects properties after rigorously assessing each area, developer and project to ensure it meets the company's strict criteria and high standards.
