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.

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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.