Brazil has ‘excellent’ potential

Emerging markets like Brazil have the best property potential in the world, according to Escapes2.com.

Adrian McDermott, managing director of the company, said that Brazil and the other expanding markets of Egypt and Cape Verde are among the most active in the world at the moment.

He said that there is currently "excellent potential" in Brazilian property, partly as a result of the improvements in infrastructure that are being pursued.

"There’s a new airport going into the north-east of Brazil. The government is investing a lot of money in infrastructure and actively targeting foreign investment in the country," Mr McDermott explained.

Pro foreign investment

Mr McDermott concluded: "It’s got one of the fastest growing economies in the world. If you have the underlying factors of the economy going from strength to strength and a government that’s pro-foreign investment, then you normally see an increase in property prices as the country increases in prosperity."

The so-called “Bric” economies of Brazil, Russia, India and China are taking increasing proportions of global property transaction activity, while the US credit crunch is adding to pressure on commercial property investment in several financial centres such as New York, London and Tokyo.

The key to investing in sectors such as the Brazilian property market, potential buyers are advised, is understanding supply and demand cycles and identifying when demand is rising and supply is limited.

Chris Allen, head of real estate fund management at HSBC Private Bank commented: ‘Latin America should be considered an area for investor interest – particularly Brazil, where falling interest and inflation rates have coincided with stability in the political system and a growth in the owner-occupier property sector’.