Brazil's government plans to restrict foreign land ownership

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MarceloRuiz

New Member
Government spokeswoman Denise Mantovani has confirmed published remarks made by Brazilian minister Guilherme Cassel, who said that President Lula da Silva had asked ministers to tighten laws on foreign ownership of land.
Speaking in the business newspaper Valor Economico, Cassel claimed that the President’s concerns were due to a desire to keep food production under Brazilian control.

“Because of food security, Brazilian lands must remain in Brazilian hands,” he said. "I am not a xenophobe but our land is finite. The population grows and demands food."
Though Brazilian law dictates that large rural properties can only be purchased by Brazilian citizens or resident, these rules have been largely overlooked in the past.

According to local media reports, a constitutional amendment is now being planned to further restrict foreign ownership.

Felipe Calvacante, president of the Association for Real Estate and Tourism Development in the north east of Brazil was keen to emphasise however that any future restrictions will apply only to agricultural land.

“These proposals only apply to agricultural land - any changes in the future would have no impact at all on people who have already invested in real estate," he said.

Demand for land plots in Brazil has increased significantly over the last decade. According to the Brazilian Agrarian Development industry, between 2002 and 2008 foreign nationals contributed $2.43 billion to land investment in Brazil.
By 2008, some 10 million acres of land had been registered as owned by foreigners.

Property consultant Dale Anderson, of Experience International, gives his top five rules for buying land in Brazil:

1. Research land prices. Land prices can vary quite dramatically and although cheaper plots may look tempting initially they may not offer the best return on investment. Check prices of similar developments in the area to ensure you are paying a fair price per square metre.

2. Check for planning permissions. Land with planning permissions in place holds higher value and investment potential so check with the local land registry if the plot has the necessary permissions or if they will be easily approved.

3. Location, location, location. The right location does not necessarily mean a beachfront setting. Look for key factors such as accessibility (air and road),established infrastructure, good amenities nearby and demand for accommodation either from the local or vacation market.

4. Appoint an experienced English-speaking Brazilian lawyer. The buying process in Brazil does not need to be complicated if you use a good agent and lawyer who understands the process. Appointing an experienced legal representative can cost around £700 although you can provide them with a power of attorney allowing them to sign and notarise on your behalf making a visit to Brazil not a requirement. When transferring funds I recommend using an FX partner such as Voltrex, securing the rate in the UK and transferring the funds into Brazilian Reals.

5. Establish an exit strategy. They key to any successful investment is establishing an exit strategy. With Brazilian land there are various exit strategies available; investors can choose to build a property on their plot and sell in a few years for a sizable profit as the build costs are relatively low. The other option is to simply hold the land for a number of years and then flip or sell it on to investors at a higher price, as land values are expected to increase by about 30 per cent per annum over the next few years in Brazil.

Brazil's government plans to restrict foreign land ownership - Telegraph
 
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JMBroad

New Member
Makes sense - people are already referring to Brazil as the breadbasket of the world - makes sense that the local population should be profiting from agricultural land instead of vast multinational corporations from around the world.

Although lets face it - it's probably going to be vast multinational corporations based in São Paulo instead.
 
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InvestinBrazil

New Member
Agricultural land being zoned for development has always been quite strict, especially when it comes to getting environmental licences to begin construction. The sense behind the government stance on this is very much about protecting Brazilian food supply and production industry to allow them to capitalise on the global increase in demand for food.
 
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