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Brazil Lures Overseas Property Investors with Low Payments and Long Term Plans - 6 May 2010

With fractional sales and developer deals on the rise, it seems property investors with little cash have their sights set on Brazil.

Holiday exchange firm RCI is reporting that sales of fractional and timeshare properties in Brazil rose 60 percent over the last year, despite property companies’ overall losses in 2009 and the worldwide recession. Experts contribute the sector’s growth to investors placing safe bets on flourishing areas, and doing so with little money. In fractional ownership, a buyer owns part of the property—as opposed to a timeshare where the buyer owns “time” to use it—with less financing hassles and fees than outright ownership.

This less-is-more-later type of thinking also explains why Europeans are sweeping up impending developments in Brazil. Even though cheaper properties can be found in other Latin American countries, developers in Brazil are offering no-money-down deals and monthly payments as low as 1 percent while the properties are being built. Construction is typically slow in Brazil, taking up to four years, but investors aren’t minding, since the global economy should pick up by then, should they decide to turn around and sell or rent out their properties. In Brazil’s most popular tourist destination, Fortaleza, condos are currently going for less than £100,00, payable over 101 months.

The country will also spent billions in infrastructure improvements in anticipation for the 2013 Confederations Cup and the 2014 World Cup. Properties have already been appreciating in the Northeast region of Brazil by 20 to 30 percent in the last few years and experts suggest that interested investors look for appreciating markets in the early to mid stages of growth and for developers with strong track records.

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