The Brazilian government, and property industry as a whole, is encouraging its national banks to develop mortgage and other financing options for foreign investors interested in purchasing Brazilian real estate. With foreign investment in the northeast coast of Brazil increasing, experts believe that new mortgage laws and programs will be introduced in the next 12 months. For more on this, see the following article from Property Wire.
The government and property industry in Brazil is putting pressure on the countries banks to offer financing options to foreign investors who want a mortgage to buy real estate.
Although buying off-plan is common in Brazil and foreign buyers who live and work in Brazil can obtain a mortgage, international investors currently find it hard to obtain finance from Brazilian lenders.
It is a situation that needs to change, according to Laercio de Souza, general co-ordinator for investment promotion at the Ministry of Tourism, and a former banker.
He said that extensive negotiations are taking place with officials and he is confident that mortgages will be available to foreign real estate investors within the next 12 months
‘Although in theory the Central Bank allows foreign investors to have access to finance in practice it does not really happen,’ he told Property Wire.
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‘In some rare circumstances, for example when a foreign buyer already has an account with an international bank such as HSBC, it happens, but the system for people to get finance is not really in place,’ he added.
He also explained how the real estate investment in Brazil has changed radically in recent years and the North East in particular is seeing a huge amount of developments thanks to its unspoilt beauty.
‘Five years ago we suddenly had an invasion of foreign buyers. It has meant that the whole system for buying real estate has moved to take this into account,’ de Souza said.
Jose Zanocchi, a lawyer with MZG Advogados in Fortaleza, north east Brazil, where property in many of the new resorts are being bought by international investors, said that there is considerable demand.
Although off-plan is popular in Brazil and very safe due to new consumer protection laws, there is a demand from foreigners for finance in Brazil.
He explained that the global credit crisis has meant that buyers looking to invest in Brazil cannot obtain finance as easily as they could in their own countries so another option would open up the market further. New mortgage laws are likely to be introduced.
Overall the North East of Brazil, with its 2,000 miles of beaches, is likely to see a massive amount of investment in the next few years. Public Private Partnership schemes are being drawn up to provide roads, transport, water and other facilitates.
De Souza added that the region will also draw funds from a $400 million pot of money from the government’s growth acceleration program.
This article has been republished from Property Wire. You can also view this article at Property Wire, an international real estate news site.