You all probably know by now, that foreigners can legally purchase property in Brazil. But do you know the common practices for buying in the country?
Here are the possible steps
1. You need a Brazilian ID called a CPF. This is a tax id.
2. To get a CPF you need a birth certificate translated into Portuguese by a certified translator and legalized by the Brazilian consulate in your home country. Or a passport.
3. You make a trip(yes, a trip! A visit to this bank usually means taking long lines!) to Banco Do Brasil with your passport and your birth certificate to formally apply for a CPF and pay a small fee. You will get your CPF number right there, but the card itself is mailed to an address that you need to provide in Brazil.
4. It’s best to use a trustworthy broker. Not only will the a good broker help you find a property, but he or she will make sure the price is fair, as well as make certain that the property is owned by the seller, and that there are no debts on it.
5.The contract is prepared by the selling broker and usually contains:
– All information of the seller
– All information of the buyer
– Location and specifications of the real estate
– The conditions of payment(s)
6. The contract is signed by both parts, and at this point, they usually recognize the signatures at a notary. “Reconhecer as firmas” is signature check done at a notary, that states that the signature on the paper is really yours or the sellers. You will have to register your signature at a notary.
7. You pay a down payment as agreed by both parts.
8. When total payment has been made, your broker will arrange the registration of the property into your name via a cartorio (similar to a notary).
9. The cost for the property transfer is approximately 4%-5% of the purchase price.
10. Payment can be made all at once or in installments of 12, 24, 36 or 48 months, but interest rates can be as high as 35%. If you opt to pay in installments, there is also a currency risk. In other words, if the value of the Brazilian Real goes down, your real estate becomes cheaper, and vice versa.
11. There is a 1% “import” tax on transfer of funds from abroad.
12. After registration, you are the legal owner.
13. There is an annual property tax of approximately 0.6% per year of the assessed value.
14. Foreigners are allowed 3 month visas, or 180 days total per year in Brazil. If you want to apply for a permanent visa, one of the following conditions must be met: You are married to a Brazilian, or you have invested more than 150.000 in a business in Brazil. Foreigners will usually set up a business, and a business bank account. Send the money there, and the buy the property on the company’s name.
Below are a few questions to ask before buying. These are sure to help you sort out if you want to buy or not.
– Is the seller the owner of the property? Or is he/she acting on behalf of the owner(s)?
– Who are the owners?
– Is the property allowed to be sold or are there any liens and/or claims?
– Is the properly registered legally and correctly at the Prefeitura(Town Hall)? Are there any taxes due?
– Is there a condominium fee and is it well managed?
– Is the area in a safe location?
– Are there any city planning for the area that might affect the value of your property?
And finally, the most important question, but maybe quite easy to figure out: Is the price a realistic price?
You must also get familiar with the process of buying real estate :
• What are the steps in the process of purchasing real estate?
• Which documents must you obtain first?
• Which documents must you sign or not sign?
• How much must you put down at the preliminary purchase date and contract?
• Where do you send money to?
• How to open a bank account in Brazil? And how should you buy if you are looking for a residency visa.
Next: Rio’s real estate market… it’s all overpriced, but there are still gems and close to the beach