Real Estate Opportunities in Pipa: how Pipa got to this point

Ocean view properties in Brazil.
Ocean view properties in Brazil.

For a long time, Pipa has been stage to a growing real estate price valuation, because first it´s a great vacation destination, but mainly because it was adopted by foreigners as one of the best places to buy second home (vacation) properties in Brazil. If it was a holiday destination famous only between Brazilians maybe the valuation wouldn´t be so big. It was the foreigners currency advantage that made property prices go up expressively there between 2000 and 2008. In 2008, after the world economy crisis, prices and sales dropped significantly.

A few factors helped popularize the destination between the europeans, some of them being: the relative easiness of access to the capital city Natal and the closest airport; the proximity with Europe and the availability of charter flights bringing europeans straight to Natal. But maybe the main reason for which Pipa is visited by foreign tourists for a long time is the availability of information in 3 languages about the destination through the website pipa.com.br. The internet was still starting commercially in Brasil in 1997, and Pipa already had a website with touristic information, being this one of the first tourism websites in Brazil.

Nowadays, with the recent economic crisis the investments of europeans have become scarce and there are lots of properties for sale in Pipa and region. Despite of that, the sales of properties keep going on and still the europeans are the main buyers. Brazilians hardly buy in Pipa because of the price and because most properties cannot be financed. One reason is the difficulty of obtaining financing credit for second home properties, and the fact that most properties in Pipa are still Escritura Pública de Cessão de Posse (a kind of document that comes before the definitive title), and not the Escritura Pública de Compra e Venda (with the registration) like the banks want. The land owning characteristics in Brazil is still of a lot of Posse(Possession Title), before the definitive Property Title, after all a simple “usucapião” process (the judicial process that turns a possession into a property title deed) that should only take a few months, takes 3 or more years because of the already known slow brazilian justice system.

Properties and opportunities for sale in Pipa.

Vacation rentals on Praia da Pipa.

How Pipa got there

Easy access facilitated foreign invasion

The path from Natal to the town of Tibau do Sul, where Pipa is, could be very nice. It passed through the largest cashew tree in the world. The giant tree is in North Pirangi Beach in Parnamirim, and covers an area of ​​approximately 8500 m². It produces about 80,000 cashews per year.

The old airport in the south of Natal allowed a trip of only one hour to Pipa, and the new airport in Natal Zona Norte. After the duplication of the BR-101 the journey became even faster but the change of the Natal airport to the north of the city difficulted things a bit. Today is easier to fly to Joao Pessoa, than to Natal to get faster in Pipa.

A little history the real estate market in the area

The Tribuna do Norte newspaper published in 2005 how international groups elected the Natal coast for million dollar projects and how names such as UltraClassic, Accor, Iberex, Sanchez, Serhs, and Vignola Club Vacanze would become familiar to the Rio Grande do Norte tourism.

In Maracajaú several international groups have acquired large areas of land for construction of resorts with golf courses. Resorts, condominiums and golf courses were the main types of investment and these investments promised insert 27,250 new beds in the state hosting offering.

In the bucolic Malemba in the municipality of Georgino Avelino on the south coast, near Pipa, French businessmen planned to erect a complex with three hotels, which were to be acquired by international hotel brands. The project sees the construction of entire villages, with appearance of small towns and the route included a marina and two golf courses. The project never got off the ground.

The Iberex Group, promised to build in Pititinga Beach, three hotels and investments of approximately $ 120 million. The complex would include 1.2 km of beach, golf course and 2,400 beds. Spanish and Dutch investors wanted to build a tourist hub in Pitangui Beach in Extremoz, 30 kilometers from Natal. A company controlled by Spanish would build 450 houses, apartments and cottages on site.

A group with business in the Spanish Costa del Sol, in the region of Malaga, Andalucia, among other areas, also lift hotel units on site. Dutch groups would be the installation of the golf course. In Pitangui, would be built four hotels and offered 2,400 beds. The Swedes wanted to create six golf courses in Nísia Foresta. Two hotels, six condos, with a total of 1,200 beds.

The success of tourism in the RN state can be explained by the attraction of charter flights

In 2003, there were only five per week but in 2005, the state came to receive 18 flights per week. Madrid and Barcelona arrived three per week; Milan, two; Stockholm and Gothenburg, two from Amsterdam, two. Oslo, Helsinki and London, one per week. TAP had regular five weekly flights, direct from Lisbon. And operators Fly Brazil, talked about starting a charter between Dusseldorf-Natal, with 270 passengers on flight every seven days.

TUI operator brought weekly to the city, about 300 British passengers.

According to Embratur, Rio Grande do Norte was the state that received more charters in Brazil.

Profile of the foreign buyers

The profile of investors was of people over 40 years with a comfortable life, and retirees in search of quality of life. The city of Natal saw a “boom” in the housing market, supported by these foreign tourists. There were brokers who spoke five languages ​​and companies in the industry, providing intensive courses in English and Spanish for its real estate agents.

The city was the second or third option of residence of those investors who would come to Natal more than once per year. And in their absence, their properties were not kept closed. They would rent or in some cases, friends of the owners – potential buyers – would stay in their homes. Many of these guests also invested in the state.

The result was that while in 2000 you could buy a plot of 1000m2 in Ponta Negra, Natal’s postcard, for US$ 50 a square foot. In the height of the bubble, the value of an area of ​​this size increased from US$ 1 million, or US$ 2,500.00 per square meter.

The future of the destination

New airport hinders access to the place

If tourists choose to get to Pipa by Natal, is expected two hours and ten minutes by taxi, and may vary with traffic. The new route – 116km – runs through the urban area of ​​Natal, the state capital, until the BR-101 South have what would be the shortest path to the south, through the town of Macaíba, with 94km, the road is still being finalized, with no provision for termination.

By bus, the tourists should be very patient, because until the final destination it will be necessary to take three conductions: São Gonçalo Airport -> Bus Terminal of Natal -> Pipa.

The road from Goianinha to Pipa

New road will connect Pipa to Goianinha and will be the most modern of the state.

Estimated at about US $ 50 million, the new highway, called Estrada Parque would be 22 kilometers long and will be the most modern state with double track, biking and special lighting. The work was scheduled to be delivered by November this year. Bringing many benefits to the region, making Pipa one of the most attractive destinations in the Northeast.

Hits: 7858
Joe Cloud
Dutch, American, Brazilian... lived there for 5 years and owns property in Brazil. Out of the country for a few years now and would like to go back, however current circumstances tell me it's not the right time.
  • Ray

    It is not as easy as it sounds, Brazilians don’t buy it, because whoever is selling doesn’t own the land.
    Foreigners are probably falling in some sort of scam, “usucapiao” is “LAND STEALLING”, you sit on someone else’s land for a certain period of time ( MANY YEARS ) , as your primary and only residence and start the intense legal battle to aquire a title for the stolen property.
    It takes many years not because the Brazilian justice system is slow but because it has to take so many years for the “usuacapiao” to take shape and for the land to became legally yours.
    “Usucapiao” is not a Brazilian invention, it is based on Roman Law, it has been around for thousands of years.
    It is a rather complicated way to aquire land if you ask me.
    Better just do what the locals do and purchase land with available “titles” and bank financing.
    And most importantly, always, always pay a Brazilian REAL STATE lawyer before purchasing land in Brazil, it will not be expensive and it will be worth every dime.

    Ray

  • admin

    Hi Ray, thanks for your reply.
    But we are talking about two different things here. Brazilians don’t buy there because they don’t have the money… things there got quite expensive.
    Brazilians are buying all the cheaper things, even with Possession Title all the time.

    In Pipa we are talking about “terras devolutas”, land that doesn’t belong to nobody. It’s the same thing if you go to several other parts of Brazil. It’s easy to find out why a few places have no owners, simply because there was nobody there before. It’s places with recent growing population, there was no interest from nobody there 50 years ago. There wasn’t even road for access.

    One point that you missed is that Usucapiao, is not land stealing. The main thing about the usucapiao law, is that it has to be peaceful occupation, and for longer than 5 years for urban land, and 10 years for country land. If you can prove that you have been at a certain place for 10 years and nobody ever complained about your occupation, then i don’t think the place has an owner. If so, why hasn’t the owner complained or removed you from there with a formal complaint at the police?
    You can prove your possession of the land with the Possession Title, a title that is done at the notary and the town hall.

    Now, if you ask me, there are risks of course, and i agree with you when you say one should always look for advice.

  • Ray

    Dear Admin,

    Sorry to be persistent, but “usucapiao” IS LAND STEALING, not stealing as with a gun pointing to the person’s face, but you occupy someone’s land with your possessions and family, once you do that, the government will not allow the property owner to throw you out, unless you have another place to live.
    The owner has to enter with an “Acao de Reintegracao de Posse” which is VERY expensive and it takes years to be resolved, it is a very complicated process.
    It is hard to believe that there is land with no owners at any beach area in Brazil, perhaps the owners died and the estate is still being settled, the descendants might be fighting over who gets what, this is the opportunistic time some shady people go in for “usucapiao” and it is still wrong.
    Sorry, but it is a low life thing to do, it is taking advantage of people when they are fragile, when they lost a loved one.
    I am a Brazilian attorney and never heard of “land with no owners”, Brazil started being colonized in the 1500’s, trust me, we are way past the point of “land with no owners” principally in prime locations with expensive land nearby.
    Every piece of land everywhere in Brazil has owners, trust me, now if the owners are protecting their land well or not, that is another story.
    No matter how it might be sugar coated, “usucapiao” is nothing but a low life, horrible thing to do, people have murdered and been murdered over the years when they adventure into this shady “gap” in the Brazilian law.
    You might fall into the hands of a dirty local Realtor who tells you that you could do “usucapiao” on a certain parcel of land and you will be watching over your shoulders for the rest of your life, because the previous owners or their decedents won’t forget, and God forbid you fall into the hands of someone with a temper!! I think your life is not worth risking for some land you could just as well acquire the LEGAL, LEGITIMATE WAY and sleep well at night.
    Thanks for your answer and for giving me the opportunity to share my opinions.

    Ray