Cares about purchasing a property in Brazil. Rio de Janeiro is a most coveted place in the world, with countless natural wonders and tropical weather which attracts all kinds of people in different countries with an intention to buy a property to invest, live or rent. However, people should take care to purchase a property with safe and tranquility.
Our law office is specialist in Real Estate law and act in this area for ten years. Some care must be taken to buy a property. A Brazilian popular proverb says: Only is owner who register a property.
Cares about purchase a property in Brazil.
The sales procedure in Brazil is complex and requires careful attention of specialist. Recently, in another article, we talk about necessity of contract a lawyer to help to purchase and sell a property in Brazil. The article is focused to Brazilian, but to foreign needs double attention.
I – REAL STATE MARKET’S HARM AND CARES TO BUY A PROPERTY IN BRAZIL
The Real State Market is harm even with the pandemic. In contrast to Northern Region of our country, Rio de Janeiro has an increase value appreciation on last years. This opportunity can even better for the people which lives abroad the country, because in the last month (AUGUST/2020) the dollar value costs about R$5,20 (five reais and twenty cents).
Rio de Janeiro is the square meter most expensive of Brazil, however, I, as a Carioca, without doubts, never change that city by any other city. Besides the beautiful landscapes, like mountains, waterfall and beaches, the city is metropolitan.
Therefore, Rio de Janeiro is much sought-after to foreign investors that wish buy a property to live or rent.
II – HOW CAN YOU BE SECURE TO BUY A PROPERTY IN BRAZIL
The Brazilian law allow the foreign purchase a property. In Brazil has a Land Registry that offers guarantee and security about the document, because keep information about property archived.
However, before this, some precautions should be taken, according below:
II.a) IDENTIFICATION NUMBER
The first step is registering an identification number (CPF). That identification can be requested although of site Federal Revenue, on Embassy or on Consulate of your country.
You need show a copy of document of identification, preferably, passport. If you were married, it will be necessary registering an identification number (CPF) for your partner.
II.b) WHY YOU NEED A SPECIALIST LAWYER?
However, cares about contract should fundamental. Most of the time, Real Estate Contract have clauses of difficult understanding and null clauses. Only specialist lawyers can preview abusive clauses and against the law. Bellow, I will list pretty situations that demand attention of professional:
- Irreversibility clause;
- Absence of table summary;
- Abusive taxes;
- Abusive clause;
- Abusive charges;
- Wrong footage of land.
These are some examples can happen on purchase property. But, exist other most worrying, like analyze the certificate, mainly if we talk about “certidão de ônus reais”, that contains information able to block the negotiation.
III – RISKS YOU INCUR WITHOUT LEGAL ASSISTENCE
Unfortunately, it is common the foreign be misled by sellers and real estate broker, that they are criminals. Thus, the situations more practiced are:
- Sale property don’t exist;
- Sale property which not responsibility by Real Estate Broker;
- Property with pendent dues, like taxes, water, light and gas.
After sale with payment, It is complicated recover the money. The Judiciary, unfortunately, leaves a great deal to be desired.
Finally, it’s necessary verify if lawyer that you contract REALLY IS A LAWYER REGISTERED AT OAB, that a competent agency which safeguarding the register of lawyers.
IV – HOW YOU CAN KNOW IF LAWYER REALLY REGISTERED AT OAB?
One of cares purchasing a property in Brazil is consult if lawyer really registered at OAB. This can be done online. Include, exist a site called CADASTRO NACIONAL DO ADVOGADO. Unfortunately, that site can’t be translate, but you can search lawyers with name and OAB number.
V – THE SELLER NEEDS A REAL ESTATE PROPERTY BROKER?
If you contract a specialist lawyer, should not necessary to contract a Real Estate Broker. The Real Estate Broker is contracted by seller and your purpose is purchase a property and to advise about the negotiation, but always aim own interests.
VI – HOW WAS POSITION OF LAWYER ON PURCHASE PROPERTY BY FOREIGN?
The principal task of lawyer is ensuring the negotiation is according with law. Besides, specialist lawyer should analyze the document and review the contract. Bellow, I will list some important tasks:
- If the property was regular at the Registered-on Government agencies;
- The seller really owner the property;
- The seller or Real Estate Broker is authorized sell the property;
- The property does not mortgage or have some responsibilities;
- The contract is according with Brazilian law.
Besides, the lawyer contracted to help you will to support with payment transference to monitor transference of property to new owner.
The lawyers normally charge about 1% to 3% of property value by service. That’s just market average does not reflect the value charged at our office.
VII – PHASES TO PURCHASE A PROPERTY
We can divide purchase property by foreign in two phases.
The first reason defines the bank that be responsible by payment. The sellers generally do not accept exterior payments, in this way, it is necessary the foreign has Brazilian bank account, besides the necessary documentation to register the property in Brazil.
Other important point is that purchase of a property in Brazil. Primally, it is necessary establish a company in Brazil. The investment registered should be realized at company, and later, the company is used like a legal part on real estate transaction.
You don’t underestimate the time and complexity related this stage of lawsuit. To obtain the correct settings of bank structure it can take months.
An interesting tip is, separately, contracting a bank negotiator of exchange and a bank. The bank negotiator are financial institutions authorized to realize, without restrictions, exchange operations and credit operations linked to exchange, like financing to export and import, advances about exchange contracts, and still receive deposits on account without remuneration, without movement.
Hence, the exchange bank which liberates the country investment assume some risks related a responsibility by money laundering.
The risk evaluation is an essential ability of exchange bank and, normally, they given itemized answers related the requirements of document than a bank of management of cashier be able to do.
VIII – CARES OF PURCHASE A PROPERTY IN BRAZIL AND NECESSARY DOCUMENTS
Afterwards the first step, will be necessary documents to foreign can purchase a property in Brazil, the document required are simple:
- The Brazilian contribution card is known like CPF;
- Sworn translation of passport;
- Register on National Public Register of Deeds and Documents.
If transaction was related a rural property, the foreign buyer should present an identification card, of National Register to foreign well-known like RNE. This ID card is just issued to foreign with permanent visa.
IX – REAL ESTATE TRANSACTIONS TAXES
Bellow, list some taxes to real estate in Brazil:
- Property Tax, well-known ITBI;
- Taxes of real estate register;
- Deed of purchase;
- Financial transaction taxes.
The real estate transactions management is decentralized. The taxes range from estate to estate. The only exception is financial transaction taxes which a Federal tax charged on cash transaction in Brazil.
Some properties need pay a contribution called Laudêmio. Laudêmio is a percentage on commercial value or real estate transaction be paid when occur an onerous transaction with definitive deed of occupation rights.
In Brazil, Union is the principal entitled of rights (marine land) or Roman Catholic Church, but have emphyteusis belongs a particular, like an Imperial Family at Petrópolis. In legal terms, a tax is a real estate right, like a rental.
If property is subject to Laudêmio, the taxes can range from 2% to 5% of declared value of transaction.
X – CONCLUSION
Last but not least, you can realize which to foreign purchase a property in Brazil, it’s not an easy task. Therefore, ride their luck and follow this way is dangerous. For this reason, our recommendation is always consulting a lawyer of your trust before purchase a property, because a lawyer helps you upon e transaction.
In this way, if you have any doubts or suggestion, you can send through of formulary bellow:
- Access our legal blog
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