Doing Business With Brazil

Doing Business With Brazil

Source: Leandro Centomo, <a href="https://www.flickr.com/photos/124360936@N08/15879062472/">Flickr</a>

Quick Takeaways

Brazil’s economy continues to rebound after the negative growth of the 2010s.
The real estate market remains strong.
Foreign investors can find appealing opportunities in Brazil.

Several real estate associations and CIPS designees specializing in Brazil can provide assistance and resources on Brazilian real estate.

Brazil’s economy continues to rebound after the negative growth of the 2010s. The GDP, consumer confidence, and export growth are all favorable. Businesses and investors who can navigate Brazil’s complex systems may find Brazil an appealing destination.

The real estate market remains strong, although sales have slowed. Meanwhile, the house price index has increased each year since 2019. Commercial real estate in Brazil is growing moderately, particularly in the realm of industrial transactions.

With the continued increase in property values, strong economy, and relative affordability, foreign investors can find appealing vacation home opportunities in Brazil. However, it’s important to understand the restrictions and procedures for foreign buyers of Brazilian properties.

Those seeking to learn more about real estate in Brazil can connect with a Certified International Property Specialist (CIPS) designee or reach out to one of NAR’s cooperating associations for Brazil.

See References for more information.

References

NAR Library & Archives has already done the research for you. References (formerly Field Guides) offer links to articles, eBooks, websites, statistics, and more to provide a comprehensive overview of perspectives. EBSCO articles (E) are available only to NAR members and require the member's nar.realtor login.

Economic Climate

The World Bank in Brazil (The World Bank, Oct. 9, 2023)

“Brazil experienced a strong rebound in 2021-2022 after negative growth in 2014-2019 and the drastic impact of COVID-19. Its GDP grew on average by 3.3 percent per year in real terms in 2001-14, propelled by the international commodities boom and the domestic expansion of social programs, among others. Yet several structural challenges persist, and Brazil’s growth trajectory is far below its peers.”

Brazil Economic Outlook, October 2023 (Deloitte, Oct. 2023)

“Brazil’s economy has been surprisingly resilient this year. Inflation-adjusted wages continue to grow at a relatively rapid clip as consumer price growth slowed. More recently, the labor market has tightened, and consumer confidence has soared. As a result, consumer spending is growing at a respectable rate. Export growth has also been notably strong, thanks in part to an exceptionally strong soybean crop this year.”

Brazil's Economic Growth Bounces Back Under Lula and Defies High Interest Rates (Bloomberg, Jun. 1, 2023) E

“Brazil's economy roared back in the first months of 2023, lifted by bumper harvests that outweighed the drag of double-digit borrowing costs. Solange Srour, chief economist for Brazil at Credit Suisse, says that the GDP data would ultimately serve to cement the central bank's position, and that the economy would face higher rates for longer.”

Top 10 Challenges of Doing Business in Brazil in 2023 (TMF Group, May 9, 2023)

“Brazil’s thriving economy and dynamic market make it an appealing destination for investors and businesses seeking to expand their operation. However, navigating Brazil’s complex regulations and bureaucratic systems can be a daunting task for businesses that venture into the Brazilian market. Discover the top 10 challenges of doing business in Brazil in 2023.”

Real Estate Issues & Trends

3 More Trends for The Brazilian Real Estate Market in 2023 (BRIC Group, Jul. 2, 2023)

Three trends are taking shape in the Brazilian real estate market: buy-to-let properties, a rise in new build homes, and sustainable construction.

Brazilian Real Estate Market Slows in Q1 (The Brazilian Report, May 30, 2023)

“The number of new real estate properties in Brazil fell by 30 percent year-on-year in the first quarter of 2023, according to data released by the Brazilian Chamber of the Construction Industry (CBIC).

Both construction and sales of new properties are down this year. There were 48,500 new properties between January and March, 44 percent less than during Q4 2022 and the lowest number recorded since Q2 2016. Meanwhile, 73,000 new property units were sold in Q1 2023, down 9.2 percent from a year earlier.”

Brazil Residential Real Estate Market Analysis 2023 (Global Property Guide, Jan. 16, 2023)

“Brazil’s housing market is now showing signs of improvement, buoyed by rising property demand and supply. In November 2022, Brazil’s FIPEZAP house price index rose by 6.34% from a year earlier, up from y-o-y increases of 5.29% in 2021, 3.67% in 2020, and zero growth in 2019, according to figures released by Fundação Instituto de Pesquisas Econômicas (FIPE). The past two months had been its biggest y-o-y price growth since December 2014.”

Brazil MarketBeat (Cushman & Wakefield, Jan. 11, 2023)

Quarterly reports on the investment, office, and industrial markets in Rio de Janeiro, São Paulo, and Brazil as a whole.

Second Home Market

Is It a Good Time to Buy a Property in Brazil in 2024? (The Latin Investor, Sep. 12, 2023)

“2024 presents a compelling opportunity for property investment in Brazil due to several positive indicators. The country's favorable growth prospects in the near future signal a conducive environment for real estate appreciation. A noteworthy trend is the consistent climb in property values over the past 39 months, highlighting the potential for sustained value growth and long-term investment gains.”

Brazil: Trends and Developments (Chambers and Partners, May 4, 2023)

Therefore, in view of the aspects above and legal background changes that improve the Brazilian real estate market, the search for new business in the real estate sector has increased, with good opportunities for local and foreign investors, given also the fact that the local currency has depreciated in comparison to other strong currencies, making foreign investment even more attractive in the next growth cycle for the real estate market.

In Review: Real Estate Investment in Brazil (Lexology, Mar. 9, 2023)

“As a general rule, foreigners may freely invest in real estate in Brazil. However, for acquisition of rural properties or properties located in the country's border area, some restrictions may apply.

Current rules and restrictions regarding foreign investments in Brazil provide that the acquisition or lease of rural properties by foreign entities and individuals, and also by Brazilian companies, the majority of whose capital is held by foreign investors or controlled by foreigners, will depend on the prior approval of the Brazilian Institute of Agrarian Settlement and Reform or the Brazilian National Congress, depending on the size of the rural property, among other restrictions.”

A Comprehensive Guide to Moving to Brazil (InterNations, Sep. 9, 2021)

Information on relocating, living, and working in Brazil as an expatriate. Includes info on visa requirements, popular destinations, and housing.

Real Estate Practices Around the World (National Association of REALTORS®, 2018)

Guidelines on real estate practices, laws, and transaction processes in countries across the globe, as provided by NAR’s Cooperating Association partners.

Real Estate Organizations & Contacts

CILA

La Confederación Inmobiliaria de Latinoamérica (CILA) is made up of the leading real estate associations in 18 Latin American Countries. CILA seeks better competitive conditions in international real estate business in and defends the professional interests of its members.

CIPS Search (National Association of REALTORS®)

Certified International Property Specialist (CIPS) designees are REALTORS® who have undergone specialized training focused on conducting business in the international real estate arena. Use this search tool to find CIPS designees who specialize in Brazil.

COFECI

Conselho Federal de Corretores de Imóveis (COFECI) is the federal association of 25 regional real estate councils in Brazil. Representing over 400,000 real estate professionals and 50,000 brokerages, COFECI regulates ethics and professionalism in the real estate industry.

Global Alliances Directory

Find referral opportunities and business partnerships in over 77 countries where NAR has established relationships.

Secovi-SP

“Since 1946, the São Paulo State Housing Syndicate (Secovi-SP) has been recognized as the home to the Brazilian real estate industry. The Syndicate houses several key operating sectors of the real estate production and service chain in Brazil, such as construction development companies, shopping malls, hotel enterprises, condominiums as well as real estate marketing and management, property rent, lease and sale, urban development and land planning.”

eBooks & Other Resources

eBooks.realtor.org

The following eBooks and digital audiobooks are available to NAR members:

Brazil: Quick Guide to Customs & Etiquette (eBook)

Brazil is the New America: How Brazil Offers Upward Mobility in a Collapsing World (eBook)

Business Across Cultures (eBook)

Business Without Borders: A Strategic Guide to Global Marketing (eBook)

Communicating Globally (eBook)

Culture and Customs of Brazil (eBook)

Emerging Market Real Estate Investment : Investing in China, India, and Brazil (eBook)

Eye Witness Travel Guides: Brazil (eBook)

Global Color: Clues and Taboos (eBook)

Global Etiquette Guide to Mexico and Latin America (eBook)

How to Say It® Doing Business in Latin America (eBook)

Investing in BRIC Countries : Evaluating Risk and Governance In Brazil, Russia, India, & China (eBook)

Multicultural Manners (eBook)

No Going Back—Buying Abroad (eBook)

Say it Right in Brazilian Portuguese (eBook)

TravelTalk® Brazilian Portuguese (Audiobook)

Books, Videos, Research Reports & More

The resources below are available for loan through NAR's Library & Archives. Up to three books, tapes, CDs and/or DVDs can be borrowed for 30 days from the Library for a nominal fee of $10. Call the Library & Archives at 800-874-6500 for assistance.

International Transactions in U.S. Residential Real Estate (Chicago, IL: National Association of REALTORS®, 2023)

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