Carnival time in brazil

As Carnival time approaches, savvy investors get serious on Brazil - so get smart by downloading the free Brazil 2009 -2010 Market Report, which includes current information on the economy and the property market, making it a must read for anyone considering buying in Brazil...

Despite all the obvious allure of the tropical beach resorts, it is Brazil's less glamorous local first residence market that is catching the eyes of the savvy investors and securing the exciting returns.

As a consequence of the strong economy, prosperity levels are rising fast in Brazil, with sharp increases in housing demand. 

In just two years, 23 million people have risen to prosperity level C (middle class), which now counts 85 million people. This middle class has a monthly income between two and five times the official minimum wage.

With insufficient first home housing stock to satisfy local demand, Brazil currently has an estimated housing deficit of a minimum of eight million properties. 

The middle classes are expected to purchase between 1,000,000 and 1,200,000 units per year until 2015. 

Fuelling demand further is the fact that for the first time in 25 years mortgages are available to Brazilians. 

Mortgages account for only two per cent of GDP in Brazil, versus 65 per cent in the United States and 74 per cent in the UK, so consumers aren't feeling the effects of credit squeeze. Massive growth in this sector means that domestic mortgages are predicted to increase by up to 600 per cent by 2014.

With this in mind it is clear that the first residence market within Brazil's regional cities is a major investment opportunity and no region has seen faster growth that the North East.

In Natal for example, a local residential 100 square metre two bed room villa with a secure gated community can cost around 180,000 Reais (around £54,000) and deals can include optional rental guarantees of six per cent for four years and guaranteed buy back agreements from the developer. 

As an investor, this means there is an opportunity to invest in well located local property that has a well defined target market and exit strategy, attracting middle class tenants and buyers. 

Anthony Fernandes of SPC Overseas, a company that specializes in investments in Brazil said, "While the tourist property in Brazil is still popular with investors and those seeking a beautiful holiday home with additional rental income, there is no doubt that the current global slowdown has had an impact on this market. 

"Investors buying beach style condo resorts need to view this as a medium to long term investment."

"In the short-term, domestic demand maintains a dominant position given Brazil's current economic situation.  Investing in first home, residential real estate developments in Brazil is a safe and very profitable strategy, with high returns and high demand for such properties," he added.

For further information and all enquiries email info@spc-overseas.com or call 0844 5982929 (UK) or +34 902945780 / +34 952927155 (international).