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Brazil property stories

Discussion in 'Brazil Property' started by sturio, Jun 30, 2008.

  1. sturio

    sturio New Member

    Hi all.

    I'm a British journalist with Reuters news in Rio de Janeiro and considering writing a story on whether the "credit crunch" and softness in the UK/US/European markets is affecting the second home market, such as Brazil's.

    I'd be interested to hear peoples' experiences on this, whatever they may be. For instance, has there been a slowdown in the hot northeast Brazil market? Are some people considering selling up here because of house price/mortgage worries back home? Any worries that rising fuel prices are going to make it more expense to get here, hurt the rental market etc.? Have too many big condo/villa developments been built? Or is property so cheaply priced here that it remains attractive despite the downturn elsewhere?

    Thanks in advance,
    Stuart
     
  2. lagarto

    lagarto New Member

    Hi Stuart

    I am an investor and developer in the Northeast of Brazil. PropertyBrazil.net

    In my experience the credit crunch in the UK/US/European markets is not affecting the second home market in Brazil. Sales are down slightly in all areas, but this is the time for sound investments in the overseas property market. Most developers are offering some form of payment option enabling the purchase and this in turn is encouraging many to actually make the move and live in Brazil...leaving the credit crunch behind.
    The retirement option in Brazil is still excellent and obviously advantagious with the above problems.
    The media is promoting Brazil big time and nobody wants to look back in years to come and say "If only I had bought my dream beach house when I had the chance"
    I have not heard of anyone actually selling for this reason.. resales are normally followed by re-investment....
    Fuel prices have always been a concern, but that is worldwide and we are not going to stop going on holidays and vacations are we !!!!

    I hope this helps..
     
  3. Dotty

    Dotty Banned

    Hi Stuart,

    I am a along time investor in commercial and residential properties in Brasil and have lived here for a number of years. The credit crunch is definately taking its toll here in Brasil . Airline tickets are almost 1,000 sterling and whilst Brasil is an attractive country ,the reality is that it is not cheap to get to and definately no longer cheap to live ,and naturally this effects all areas.We are seeing fewer European tourists than previous years without a doubt which has effected 2 hugh developments in Natal GNG and Lagoa de Coalho and a few smaller ones along the way along with ALL business in general.

    With regards to buying and sell in Natal it will be pretty difficult to sell on as there aren't an tourists scrambling to buy at present and the difficulties of trying to sell on when you live overseas is a pain especially in Brasil! Also to buy at 3.00 real to 1 sterling is not very smart also ,because when you go to sell the taxes are hugh ,plus the added taxes to take money out 17%+,so mathematically not a very attractive buy and most buyers aren't aware of this.

    The positives are Brasil is beautiful to visit ,but air prices and cost of living makes it out of reach for most overseas tourist,hence the downturn.
     
  4. robh

    robh Administrator Staff Member Premium Member

    Hi Stuart,

    I am sure you will get an interesting spectrum of answers to your questions :).

    As far as uv10 is concerned the second home market in Brazil hasn't slowed down, but we only sell in a select number of areas and developments in the north and south of Natal, and our clients usually don't have to rely on credit to invest.

    There are a lot less investors around these days since the credit crunch, but a higher percentage of active investors are looking at Brazil as there is a lot of positive news coming out of the country. Also there is a flight to quality rather than quantity with a larger emphasis on exit strategy and returns.

    Interestingly we have seen a lot of investment in the NE recently by foreign institutions and corporations, which means they are obviously very positive about the future.

    Regards,
    Rob.
     
  5. Raimundo

    Raimundo Guest

    A Reuters journalist is asking this question? :rolleyes:

    What do you think Stuart? You're a journalist.... :eek:
     
  6. Dotty

    Dotty Banned

    We're so naive!
     
  7. PAUL-brasil

    PAUL-brasil New Member

    A more sensable outlook


    Credit crunch is making investing in Brazil more attractive! Investors dont want to invest in countries where property prices are falling (obviously), so buying in a market where the economy is growing and a stronge and growing property market like Brazil makes sense surely, thats why so many investors are now doing business in Brazil.

    Yes £1K is high, you have maybe not lived in the UK now for so long, but trust me on this, the last thing you want for Natal is very cheap flights from the UK! Having 300 cheap end of the tourist market Brits turning up each week causing havoc, wanting to fight anyone for any reason after a few drinks (and that just the women!Lol) and scaring all the well behaved Dutch and Scandanavians away! Just ask the Spanish from Benidom etc. People are not going to want to live/invest there, especially Brazilians!. Oh and I ve earned the to say that about many Brits, I am as English as they come.

    Cost of living is up and very much rising everywhere! Again Dotty you are away to see the higher prices here. Night out in Brazil - still a fraction of the price than the UK.

    GNG is introuble because of the administration of the Spanish developers, due to the large down turn in Spain! Lagoa do coalho - Cant complete licenses, and much overpriced in my opinion.


    If there was less tourist to sell to, then so what, if you buy to only to try to sell to the gringo market then you are really wasting a great national market and really missing the concept of investing in Brazil! A strenghening R$ makes no differance to the Brazilians when purchasing a property. Also great money can be made in a strenghening currency, I bought 2.5 yrs ago 4 to 1 to the £, If i sold now, which I certainly dont want to, then theres 25% made already before I even consider my increased property value,. So still great possibilities if people buy now then the strenghening R$ and weaking £ makes 2.5 to the £ in 2 year time, maybe!

    Thats 15% on Capital Gain, and they are certain tax advantages if you know what you are doing.
    Regards
    Paul
     
    Last edited: Jul 1, 2008
  8. Dotty

    Dotty Banned

    Well I am not sure where you live or where you have or will invest,but I can tell you Natal is NOT booming and will not for the near future.Please read Tribuna do Norte(Sunday edition).People are not willing to pay 1,000 for an airline tickets ,when you've got Australia,Malasia ,Bahamas etc for great prices and stunning at that -hence hotels ,bars,restaurants,empty.I am a frequent traveller to europe and consider the uk not too pricey comsidering salaries providing you shop around.I paid 10,00 sterling for Lord of the Rings including a delicious Pizza in Stone and Fire Covent Garden and a skiing trip for near to nothing .If I want to go sking in Argentina I will need to pay about 5,000 reais and that's with just a 3 day pass and hired clothes for 1 person for 7 days and a bus journey to reach the runs to then see the rest of Natal on my trip ,yet I can ski in the best mountains for near to nothing in Europe with quality !Brasil is not cheap I cannot emphasis it enough and only those that live here daily can truely tell you .What about our journalist bfriend in Rio what is the quality of life like and what are the rental returns and restaurant prices ????
     
  9. PAUL-brasil

    PAUL-brasil New Member

    Dotty, I never said Natal was booming, I have no interest to invest in RGDN, and in general I dont rate it for investment reasons, many I ve stated on here before. I have been to RGDN 4 times, Ceara 6 times. I will be a permanant resident in Ceara in 4 weeks time. I invested 2.5 years ago a villa in Ceara bought on the ground locally and I also have some land. I m still very pleased with my investments.
    Yes cost of living has gone up in Brazil, I certainly notice so much agreed. You miss my simple point, cost of living has gone up considerable in the UK, and much Globally, mainly due to oil prices. Yes cars, electrical good are more expensive in Brazil i know. Cost of living generally does not include a DVD and a ski trip in the grand scale of things.
     
  10. JMBroad

    JMBroad New Member

    Pardon?

    10 GBP for what?
     
  11. Camelungi

    Camelungi New Member

    Slowdown

    Hello Stuart,

    Here at Fortaleza, North East Brazil, the credit crunch is not that serious yet.... there are other factors going on which are making problems ......the price of rice and beans has shot up because of the food situation world wide and farmers investing in BioFuel crops.....for the general population this is more of an issue.

    I would say consumerism of the like we see in the US, UK and Europe which has been encouraged by Banks is somewhat different. The banks here didn't lend money to uncle tom cobbly and all fuelling a huge consumer boom. A large part of the population need to have better incomes as they barely manage. Incomes are rising but only slowly. lending is starting to become popular and I suppose this is why shops and trading seem to be busy...but so is crime. how the credit crunch from abroad will affect here is hard to say. Looking at the news daily at what is happening to Freddie Mack and Fanny Mae.....Some financial experts are starting to stare into the financial abyss. In modern times we do not have a similar scenario to look at with all same the current problems with high cost of oil and gas. Shipping cheap goods around the world no longer looks like a good deal. If the US Government makes wrong decisions or is powerless against huge financial problems - the knock on effects world wide could be very great. But for now the credit crunch is only just biting and I suppose will only effect tourists who cannot afford to pay the air tickets etc and make do with places that are closer to home. Investors whose currency is falling against the Reais will probably look elsewhere or wait till things become favourable. If Oil prices do not drop and become more realistic it will make air travel unrealistic....It will drive foreign tourists away and the developments which have been built around this will suffer.

    I live here but have no intention of selling up.

    Regards


     
    Last edited: Jul 13, 2008
  12. debzor

    debzor New Member


    Stuart - simple, wide ranging, all embracing, answer? NO.

    Dotty - Quote me to fly to Europe (return) from here then fly to ski resort in Europe (you choose which one), hire all the gear, including suits, lift passes, etc, etc, and still claim that from here it is cheaper than Argentina? At least compare like with like, and the exchange rate makes Argentina very attractive. Anyone want to organise a last minute group?

    Any slow down in Natal is probably caused by their own success. As more people invested, so prices increased, investors looked elsewhere and found better deals. However, even though I have been critical of Natal in the past, I still believe the eventual future there for investors will be 'Christmasy"!
     
    Last edited: Jul 25, 2008
  13. Dotty

    Dotty Banned

    Prices are not rising as much as expected as there are too many properties available and not enough purchasers!Not to say that won't change in the future,but you will need to get here easily and with reasonable priced air tickets to match that are frequent and do not require stop-overs with long connections.If you live here it is fine,but rushing back and forth from the UK or elsewhere to sort out something urgent in Brasil is not my idea of a safe and secure investment and very time consuming and boring.
     
  14. ExpatNick

    ExpatNick New Member

    Dotty - tax to withdraw money from Brazil?

     
  15. davehoskings

    davehoskings New Member

    I believe you own in PN? If you own where I think you do then you would know that the latest development by the same company right next door sold out in weeks, I wonder why you forgot to mention that????

    Who flies to Brazil from the UK when you have to sort out anything, that's what a lawyer is for.
     
  16. robh

    robh Administrator Staff Member Premium Member

     
  17. Dotty

    Dotty Banned

    Spot on Rob,

    You have more experience in sending money out of Brasil and full costs involved.
     
  18. lagarto

    lagarto New Member

     
  19. Dotty

    Dotty Banned

    Firstly ,the company that you are talking about have an excellent reputation here in Natal and have produced great projects over the yrs and continue to do so.There properties are of very high quality and sell easily for this reason,but that does not mean that every property that goes up in Brasil has the same effect!
     
  20. Mineiro

    Mineiro New Member

    I wouldnt have said that property here in Brazil is at all cheap if you are buying to use as a holiday home . The cost of flights is astronomical and the cost of living is increasing rapidly. Why should someone think of buying a slightly cheaper house here in Brazil where he will have no profit whatsoever in renting ; where the roads are full of holes ; where more people die per year in shootings than Iraq (FAR MORE) ; where there isnt a decent sewage system; and where if he happens to hurt himself he can either chose to pay a small fortune in medical bills or face probable death in one of the public hospitals that is if he manages to get in through the door.
    I would have thought there were far better places for a european or an american to buy a holiday home!!!!!!:D
     
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