Brazzil

Based on the article, it clearly says :
"Even if the deposit/earnest money has been paid and the buyer later pulls back for one reason or another, the seller is liable for the full broker commission."

This means that the SELLER must pay the commission NOT the buyer.

IS THIS REALLY CORRECT ? Because in reality, in many cases, the commission is expected to be paid by the BUYER.......NOT the Seller !

Please clarify...Mr Expert !

Technically, the seller is always responsible for the commission. If the payment is not explicitly set to the buyer by the purchase agreement, the payment defaults to the seller (who is most often considered the hiring party). Buyer broker services are not very common in Brazil. In practice though, the seller would settle for a specific sum for the property and the balance payment (the broker fee) to be paid directly to the broker (it is most often done for tax and logistics reasons). So it might appear that the buyer is paying the fee.

The acid test of such arrangement would be a situation when the buyer pulls back after either signing the intent to purchase or even after shelling out the down payment. The seller then (not the buyer) would be stuck with the onus of settling the broker’s commission.

Boris, Is there a legal process to ensure that a person is actually getting a clean title to a property/home being purchased? Also, what about for sale by owner for people that don't appreciate paying a brokers commission, isn't this a possibiliby in Brazil?

In order to draw Escritura Definitiva ( title deed that can be registered for definitive ownership transfer) it is necessary to obtain Certidoes Negativos - a set of documents for each seller(s) and the property that provide more then adequate picture about the legal and financial status of the property and its owner(s). Without these documents the Escritura Definitiva can´t take place. It also can’t take place if there are any legal or financial impediments to the ownership transfer listed in the documents.

In short, for a primary scan of the property status it is imperative to obtain the document called Ônus Reais which is the equivalent of a historical title extract (going back 20 years). This document would be the first effective and inexpensive step in ensuring that the title is "clean". The more expensive, lengthy, and effective process is obtaining and analyzing the Certidões Negativos,

All the documents can be obtained without assistance of a broker or an attorney by requesting them at a local Cartorio. Needless, to say that to analyze these documents would be extremely difficult for a lay person, many times so for a foreigner.

So, the seller can present the documents without involving a third party, but it falls to the buyer to either employ or not a real estate or legal professional in this case.

Thank you for the detailed answers. It remains that based on your explanations, if a seller wants a certain price, the difference (broker fees) must be paid by the buyer. Thus this fee is not an "appearance" to the buyer...but a fact of an added cost, it seems to me ! smile

Another question : if a foreigner wants to buy a restaurant or beach bar (things like that) it appears that many problems arise :
1) all the official accounting is wrong.....thus one has to stay in the premises for quite a long time to estimate the true revenues !
2) the official selling price is always far below the real selling price, especially in the Northeast. This create problems in the sense that the buyer must disclose the source of the payments for tax purpose, but in fact all the legal documents show another amount.
How to reconcile the amounts and how to deal with this ? Because you make a payment of X but you get a legal receipt for far less !
3) It looks like that it is quite regular that after having bought one of these places, some unpaid debts due but hidden from the seller, are still due by the new buyer !

What about in the case a foreigner residing in Brazil finds a real estate of some type through Internet or a newspaper ad (thus already implying an agent) if the eventual buyer wishes to have also You involved ? Must the commission be paid twice or would the commission be paid once only and shared with the 2 agents ?

There are two options available: It is always possible for the commission to be split between two (or more) agents involved,. and, actually, it is the more common approach. I prefer to base my commission on performance (in case of providing buyer brokerage services). I would base my commission on the percentage of the difference between the asking price of the property and the purchase price I am able to negotiate. This way I can fulfill my fiduciary duty to the client without any potential conflict of interest; and deal any and all brokers and agencies as well as with properties listed FSBO. No sale commission split or fee taking from the seller in this case.

There is also "fee for service" available on piecemeal basis. Bottom line being the ability of the client to choose the most suitable form of compensation.

Thank you for the detailed answers. It remains that based on your explanations, if a seller wants a certain price, the difference (broker fees) must be paid by the buyer. Thus this fee is not an "appearance" to the buyer...but a fact of an added cost, it seems to me ! smile

You are very welcome. Actually, what I meant is that if the seller wants a certain fixed amount, let´s say R$100K the buyer would have to pay R$105K or R$106K, or whatever value of the sale price (including broker fee) that has been negotiated. This is not always the case. More often after a price has been negotiated. Let´s say R$110K, the buyer would either pay the full amount to the seller who would later on disburse the fee to the broker(s), or pay the seller and the broker(s) the agreed amounts totalling R$110K separetly. In either case, it is not the additional onus on the buyer, but a negotiated form of paying broker´s fee.

Another question : if a foreigner wants to buy a restaurant or beach bar (things like that) it appears that many problems arise :
1) all the official accounting is wrong.....thus one has to stay in the premises for quite a long time to estimate the true revenues !

It is quite possible that the books are not going to tell you the true story. The only way to adequatly appraise anything in Brazil is to get to know it as intimatly as possible and spend as much time around it as possible

2) the official selling price is always far below the real selling price, especially in the Northeast. This create problems in the sense that the buyer must disclose the source of the payments for tax purpose, but in fact all the legal documents show another amount.How to reconcile the amounts and how to deal with this ? Because you make a payment of X but you get a legal receipt for far less !

Nope, it is not actually always the case. The real procedure calls for approval by the City Hall authorities of the amount of the intended transaction. At least in Rio de Janeiro, there are many cases when the approved amount is actually more then the value of the actual transaction. In any case, it is a problem. While the practice is very much a part of the re market in Brazil, it is illegal and could cause more problems and financial burden to foreign buyers then benefits it could providing through savings on ITBI, Laudemio, and other fees and taxes. I would advise bypassing properties that call for double-book accounting.

3) It looks like that it is quite regular that after having bought one of these places, some unpaid debts due but hidden from the seller, are still due by the new buyer !

It is easier to do due diligence on a private property then on commercial property especially if there is a combined purchase of a property and business. Debts are actually hard to hide in Brazil, and a smart attorney can pre-empt emergence of the potential debt problems by embedding some additional clauses in the contract that keep the seller responsible.

Hey Boris, that's mostly for you than for your client.

Don't just forget to add the mandatory commissions. They are very strict in most of the country. Here goes a small table: http://200.241.231.153/Sistema...arios.aspx

And don't forget that those fascists from Creci will visit you if you are charging less than the mandatory fee (usually 6%), and will visit you every year if you are a regular broker in order to ask you if you have ever seen some illegal broker in the market or if a broker has acted suspiciously. Are you aware of it, aren't you?

Dear Truth,

It has to be good for both sides. Actually, the reality of the market is such that it is quite often necessary for the broker to reduce commission in order to make a sale happen. OK, let´s be careful with definitions here. Broker would charge the full commission, but would pay certain expenses from his pocket in order to smooth the transaction

Fiscalization by the local CRECI is unfortunatly rather lax. Mostly due to the insufficient numbers of inspectors. I am not sure if it fair to call people who are doing their jobs "fascists"

Excuse me Boris, but I would call them fascists, as their methods are quite intrusive. Quite simply, they have their own officials, but are always encouraging their affiliates to denounce their coleagues or other people who meddle in the business, BY COMING TO THE HOUSE OF THEIR AFFILIATES. That's a fascist approach in my view. Creci is something that shouldn't exist at all.

As for the rest, I agree. I have known of many cases where the commission is less than it should be by the book, specially for expensive real estate. Normally, things are really dealt in a manner to make it good for both parts and that's the way it should be by law too. What I'm emphazising here, and that's why I wrote this sentence mostly for you than your client, is the problem of mandatory commissions. For cheaper real estate, the 6% are the rule, as the brokers who work in this price range tend to follow the rules more strictly, both because the other brokers are likely to denounce them and both by simple fear of the law. Anyway, I'm changing the subject of the discussion, and my point is that mandatory commissions are just one more face of the incredibly inefficient economical and legal systems in Brazil. Quite simply, the legislation puts a ridiculously high price for broker fees and introduces unnecessary legal risks in the system. It's a shame that such regulations have passed to benefit some people in the union, but in the end, everyone loses, the brokers, and the clients and the union (which then presses to increase the fees when the money gets scarce).

I just needed to put this comment here. I would emphasize for your client that living by the book in Brazil is nearly impossible (perhaps I'm even being too kind here) and some outlaw things are expected to happen. And for you Boris, if don't wish to discuss that, it's ok for me. I just needed to add this point in order to show the other people how messed up is Brazil.

Excuse me Boris, but I would call them fascists, as their methods are quite intrusive. Quite simply, they have their own officials, but are always encouraging their affiliates to denounce their coleagues or other people who meddle in the business, BY COMING TO THE HOUSE OF THEIR AFFILIATES. That's a fascist approach in my view. Creci is something that shouldn't exist at all.

I agree there is a fine line between self-fiscalization and dictatorial practices of snooping and denouncements. I disagree about the CRECI, it needs to exist. Furthermore, it has to do a lot more in order to professionalize and establish the profession of the real estate broker. The market and the clients stand to benefit from professional approach and organization of the practice of the profession. CRECI is a professional organization run by democratic methods. To get rid of it would be an equivalent of imposing further anarchy on real estate market in Brazil. I don’t think it could stand any more anarchy...

As for the rest, I agree. I have known of many cases where the commission is less than it should be by the book, specially for expensive real estate. Normally, things are really dealt in a manner to make it good for both parts and that's the way it should be by law too. What I'm emphazising here, and that's why I wrote this sentence mostly for you than your client, is the problem of mandatory commissions.

Ideally, the CRECI Broker Fee table would be applicable in all cases. It would also help if it had more built-in flexibility in order to introduce de jure reduced fees, discount brokerage services, and other perks for the client. At this point, it is legal (Although it could be interpreted as an ethical violation and punished by the CRECI) to state reduced commission in the service contract.



Anyway, I'm changing the subject of the discussion, and my point is that mandatory commissions are just one more face of the incredibly inefficient economical and legal systems in Brazil. Quite simply, the legislation puts a ridiculously high price for broker fees and introduces unnecessary legal risks in the system. It's a shame that such regulations have passed to benefit some people in the union, but in the end, everyone loses, the brokers, and the clients and the union (which then presses to increase the fees when the money gets scarce).

I do not think that broker fees are that high in Brazil. They are on par with what is charged in many states of the United States and other countries. Actually, it is much harder to be a broker down here then in a first world country. The very confusion and inefficiency of the market warrants fair compensation for a qualified professional who could safely guide the client through the legal and logistical mazes.

I just needed to put this comment here. I would emphasize for your client that living by the book in Brazil is nearly impossible (perhaps I'm even being too kind here) and some outlaw things are expected to happen. And for you Boris, if don't wish to discuss that, it's ok for me. I just needed to add this point in order to show the other people how messed up is Brazil.

Yes, playing by the rules in Brazil is tough if not impossible most of the time. From where I stand, it is imperative that the client knows the score. The score including the way the things ought to be and the way the things are with all the pros and cons of each option. The decision would fall to the client.

As far as the discussion of the inefficiencies and problems of the real estate market in Brazil is concerned, I think it is crucial. This is what I’ve been doing for the past 5 years through my web site.

I agree there is a fine line between self-fiscalization and dictatorial practices of snooping and denouncements. I disagree about the CRECI, it needs to exist. Furthermore, it has to do a lot more in order to professionalize and establish the profession of the real estate broker. The market and the clients stand to benefit from professional approach and organization of the practice of the profession. CRECI is a professional organization run by democratic methods. To get rid of it would be an equivalent of imposing further anarchy on real estate market in Brazil. I don’t think it could stand any more anarchy...

There is a thin line between self-fiscalization and dictatorial practices, and Creci is crossing that line, either by pushing too much regulation and also by turning their affiliates into denouncers.
I do not agree there is any anarchy in the real estate market in Brazil. What exists here is too much regulamentation with lax fiscalization in *some regions*. There is even a requirement for brokers to have passed a one-year course on real estate transactions and even college courses on this subject. That does not look like anarchy. The problem with Creci, as well as the other "class councils" is that they are mandatory. If Creci was optional, they would have to struggle to justify their presence to both the clients and the brokers, and there would be sure a great increase on the level of service. Most of all, Creci would not be a place for political bargains, like happens in other councils, and would be handled in a more professional manner. The defense of Creci is mostly done by brokers who are afraid of the competition of non-Creci workers (i.e., illegal brokers by brazilian laws). Why are they so afraid, if those people are supposed to be low skilled? Many brokers in Brazil spend more time with bureaucracy to register the property than selling it actually, which makes many brokers into bureaucracy workers, a clear distortion of their original functions. In an ideal market, with little regulation and clear rules, I don't see any big risk for an average person to get informed about the laws and transfer the property, having the broker solely the function of having a buyer and a seller to meet each other.

Ideally, the CRECI Broker Fee table would be applicable in all cases. It would also help if it had more built-in flexibility in order to introduce de jure reduced fees, discount brokerage services, and other perks for the client. At this point, it is legal (Although it could be interpreted as an ethical violation and punished by the CRECI) to state reduced commission in the service contract.

Legal, but illegal, Brazil is a wonderful place . If everyone in Brazil thought like you, this country might be a little bit better. I go yet further to say that Creci should not be mandatory and should not be a monopoly, as I said earlier. In my view, the rates should be negotiated between the clients and the broker, not mandated.
If Creci was not mandated, that would be ok. They could say to brokers that, in order to be their afilliates, they needed to charge 6% of urban real estate, 10% of rural real estate and so on. If the broker doesn't like it, go to Other Creci. If the client doesn't like it, hire an Other Creci broker. But the way it's now, with Creci having the monopoly on the profession, the mandatory fees only cause harm.

I do not think that broker fees are that high in Brazil. They are on par with what is charged in many states of the United States and other countries. Actually, it is much harder to be a broker down here then in a first world country. The very confusion and inefficiency of the market warrants fair compensation for a qualified professional who could safely guide the client through the legal and logistical mazes.

I also agree that brokerage fees are not high in Brazil *when* they are negotiated in the market, by breaking Creci's ethical violation, which could mean fines or the prohibition for the individual to keep working as a legal broker. But charging 10% for a rural property or 15% for a terrain, *mandated by law*, is way too high. Anyway, you confirm what I said, that all this burden of regulation only make things worse for both clients and brokers. Only a small portion of the brokers, those who know how to deal with the bureaucracy maze, earn a fair ammount of money. Even so, they earn much less than in the United States.

Yes, playing by the rules in Brazil is tough if not impossible most of the time. From where I stand, it is imperative that the client knows the score. The score including the way the things ought to be and the way the things are with all the pros and cons of each option. The decision would fall to the client.

That's exactly what I mean, and that's how business is made in every market in Brazil, not only the brokerage market. Now I ask, what do we gain with that? Everyone loses in this stupid game, including the government in the long run.

- whatever way you explain.....the broker 's fee ends up to the cost of the buyer ! smile !
- Boris is right that CRECI or "someone" must regulate efficiently and strictly every job, especially the independent jobs ! I was myself a stockbroker for 30 years for large U.S.Firms....and trust me.....it is highly regulated with long learning process, examinations, registration, regular updated new mandatory courses...etc etc.for the benefits and security of the clients !
- 6 % is relatively ok but quite shameful the 10 or 15 % for land or farms. In my country, Switzerland, the rule is 5 % for values up to $ 400'000, then 3 %, but reality is that everything is negotiated without any problem and 1 % or so is common on buildings or commercial transactions valued at $ 20 millions or more !
- In Argentina, they have the fairest rules : 6 % for everything (house/buildings/land/farms) and the fee is splitted 50/50 between the buyer and the seller. Fair, clear and simple !
- Going back to commercial real estate, it looks like you are not really familiar as to how things are in the Northeast of Brazil : even far more tax evasion and corruptions than in the South. Smile....but so it is !

Going back to You Boris as a buyer broker, please clarify :
If someone (not you) finds a property he is interested, assuming the asking price is Reais 2 millions,
the buyer may have a first visit of the property and discussion with the seller and/or his agent (without you......yet), price could already be negotiated somewhat, lets say 1,8 millions. Then when the buyer (myself) may say : ok now you (they) have to contact my agent (You) to finalize and legalize the transfer of the property.
Does that make sense ? At least it does for me, if I dont want you to necessarily make all the research for what I am looking at, I may as well also look around myself and take your services only when and if I am ready to finalize a transaction ! In this example....what would be your fee if it is for a house or an appartment !
Final question, can you be a broker for all brazilian states/cities or are you restricted to a special area either by your own choice or by law ?

Cordially

If someone, not me, finds and negotiates a property and either side is interested in my services I am available at per service rates. In reality, my experiance and track record prove that I can get a better price and conduct the transaction with fewer problems then when I am not fully involved. Please, feel free to e-mail me for consulting rates and conditions.

I´ve been working and consulting in Rio de Janeiro, Natal, Maricá, Maceió, Buzios, Petropolis, and a couple of other locations. While my CRECI registration is for the State of Rio de Janeiro, I can legally work on entire territory of Brazil.

- Boris is right that CRECI or "someone" must regulate efficiently and strictly every job, especially the independent jobs ! I was myself a stockbroker for 30 years for large U.S.Firms....and trust me.....it is highly regulated with long learning process, examinations, registration, regular updated new mandatory courses...etc etc.for the benefits and security of the clients !

Let me put my point clearly. I want to defend consumer options here, that's why I said that CRECI should not be mandatory, as this monopoly creates room for political bias and abuse of the power to regulate, just like we see it in Brazil. But of course CRECI could have their own regulations, stating that members should have undergone a training of 1 year, that mandatory fees for members are 6% or something like that. The customer may opt for a broker not affiliated to CRECI, but he/she will be doing that at his/her own risk.

In a general manner, the same applies for stocks exchange. Apart the fact that there is some regulation on behalf of the United States government, each Stocks Exchange house has its own regulations. If you are not happy with NYSE, you could go to NASDAQ or to the stocks exchange created by the son of your neighbor, for instance. It's at your own risk, as long as private property is protected. But can you imagine what would be of America's Stocks Exchange if they had only one mandated Stocks Exchange house?

...but no one can buy stocks outside of Regulated And Supervised Stock Exchanges ! Fortunately for the public security ! Thus I cant go to the stock exchange created by the son of my neighbor ! Fortunately...tooo !!!! smile ! -)))))
And new exchange places must be pre-approved first not after, with disclosed rules and regulations, before being able to trade stocks or whatever with the general public !

And doing something illegal has costed billions of dollars....to those involved ! the penalties were much higher than the benefits of the illegal things they did. It is the only way ta make sure that doing something illegal has a much higher cost than the benefits !

cheers

I know that. That's why I put it "apart the fact that there is some regulation...", I'm aware of it. There are all those acts like Sarbanes-Oxley and other regulations. The stocks exchange of the son of your neighbor was really a bad example here, I just meant that american system is much more flexible than ours.

Anyway, my opinion is that mandatory regulations are a dangerous game, and that happens even in the US. But that's another subject anyway.

i'm from Brazil, this article does not help much if you want to buy something...There is a lot of tings that you should know and check before buying real estate here...Also, if you are a foreignerit is better and a lot safer to look for a good "imobiliaria"(real estate broker company) instead of a broker individual if you want to buy or sell

by the way the selling fees(it is always the seller who pays) are not 5% to 10% , they are 4% or less depending on the region....

The article is not designed to "help much" those tho are considering buying real estate in Brazil. The purpose of the article is to deal with a specific aspect ot a real estate transaction, mainly hiring a broker.

No question about the need to know as much as possible about the market and the ins and outs of real estate operations. Any pparticular reason why you would recommend working with an agency vs. individual broker?

I am also curios about where you get your information about the selling fees? Would you care to substantiate your claims? Sources? facts? please...

Thus please help and clarify by providing your knowledge and expertise on that subject.

You will truly help the readers by giving some details !

Cordially

One major thing that I don't see mentioned in your article is the AMOUNT or PURCHASE PRICE being listed on the title.

I have purchased several pieces of property here in brazil, I am an american. And the one of the biggest problems arises when the seller refuses to put the REAL purchase price on the title, or escritura. And, in my experience, NO ONE is willing to do this!

This causes HUGE problems for the buyer, especially a foreigner. If a foreigner wants to purchase a property in brazil and you open up a business to do this, in other words, you're making a "foreign investment in brazil". Every single centavo that LEAVES your bank account MUST have a nota fiscal, or legal receipt.

So let's say you've purchased a piece of property for $300,000, but the owner is only willing to put a purchase price of $100,000 dollars on the title, how do you justify this other $200,000 to receipta federal? Where did it go? To buy drugs? Arms? You get my drift.

BUYER BEWARE!!! For you foreigners looking to buy a brazilian property you'll see exactly what I mean in your first negotiation. I've been all through it, dozens of times, and in numerous brazilian cities....it's all the same. Brazilians don't want to pay taxes so they'll cause huge problems for you if possible, as long as they don't have to pay taxes. And this situation hasn't only happened to me, I know several other foreign people and companies that have made or making "foreign investments in brazil", its all the same. The attitudes of corruption permeate every single aspect of brazilian society. So if one accepts these types of terms, you'll find yourself particpating in a system where you must break more laws than just fraudulent documentation and tax evasion.

If I would've known 3 years ago what I know today, I would've never bought ANY material asset in this country.

Well, the article deals with one very specific aspect of a real estate transaction in Brazil - hiring a real estate broker. Accidentally, I´ve covered the question of the understatement of the sale price in the title deed in another article named Three Reasons not to Understate Purchase Value of a Property in the Deed Transfer Document published on Lifestyles Brazil web site: http://www.lifestylesbrazil.co...=0&thold=0
and in the August edition of Jornal Copacabana (PDF version available here: http://www.lifestylesbrazil.co...load&cid=3)

In my experience, sellers do give up insisting on understating the sale price if faced with the possibility of losing a sale. Many of my clients and Lifestyles Brazil members have purchased propertied without any problems. Of course, Brazilian market is not for unprepared or underinformed; even for a seasoned investor, it is often more then challenging. The risks are great, but so are the rewards. While, financial gains can be had, I still insist that the most benefitial reason to invest in Brazilian real estate is to lower cost of living and to improve quality of life.

Regards,
Boris Goldshmit
Licensed Real Estate Broker – Brazil

CRECI RJ 35267
boris@lifestylesbrazil.com
55 21 2236-1819
55 21 9149-6856

quote:

"While, financial gains can be had, I still insist that the most benefitial reason to invest in Brazilian real estate is to lower cost of living and to improve quality of life."

Well, there are MANY things in brazil that are much more expensive than in other countries, first world countries. Not only that, but many times one is buying inferior quality that is more expensive. Brazil is not that cheap of a country, especially when one takes into consideration the wages that people earn here. Look at gasoline, "Brasil auto-suficiente in petroleo", what does that mean if I'm paying more here than in the U.S.!

As far as quality of life, I live in the northeast, in a capitol city that boasts to have the "best quality of life in northeastern brazil", and 60% of the city doesn't have sewerage systems. Mix in the crime, corruption, and attitudes of disrespect for people, the law, objects, and the very place in which they live, and I have a hard time seeing "quality of life".

Beauty is in the eyes of the beholder, so is quality. Brazil by no means is problem free nor is it attractive to everybody. Alas, there are hundreds of thousands of expats living in Brazil by choice who would strongly disagree with your arguments. I am one of them.

If you find Brazil to be such a poor deal why do you still live in the poor wretched North East? If you think that you could find a place totally free of crime, corruption, and environmental problems, to move to what are you still doing down here?

it's more a place with a total disregard for respect. It doesn't matter where you live either, as I live in the richest neighborhood and in one of the most expensive apartment buildings in my city, and still, neighbors have no respect for one another.

I truly can't imagine having a serious illness in the city in which I live where the doctor prescribed "rest", because it's just not possible. At least here in the northeast of brazil, it doesn't matter how rich a neighborhood you live in, the poverty comes to your door, both literally and the "poor" attitudes/morals/respect by the majority.

quote:

"If you think that you could find a place totally free of crime, corruption, and environmental problems..."

No, I'm not asking of a place FREE of these things, don't take my response to the extreme. But I certainly don't like living in one of the most corrupt and violent countries on the planet, and that is brazil. It was just announced on the news tonight that the United Nations is coming to brazil to investigate corruption!!! The FIRST country that the U.N. has gone to to investigate corruption outside of AFRICA!

The Brazilian gov't. gave their consent for them to come....BUT ONLY AFTER THE ELECTIONS!!!! LMAO!!

quote:

"so is quality..."


Have to 100% disagree with you there. Quality, as in product quality, is measurable, it's not subjective.

it's more a place with a total disregard for respect. It doesn't matter where you live either, as I live in the richest neighborhood and in one of the most expensive apartment buildings in my city, and still, neighbors have no respect for one another.

Well, the most expensive areas with exclusive properties are hardly torchbearers for respect and consideration anywhere in the world. Try a typical high-end building in New York City for example, or look into petty squabbles of rich and powerful neighboors in California... In Brazil, I´ve seen more consideration and respect in areas that would be considered dirt poor by your standards.

I truly can't imagine having a serious illness in the city in which I live where the doctor prescribed "rest", because it's just not possible. At least here in the northeast of brazil, it doesn't matter how rich a neighborhood you live in, the poverty comes to your door, both literally and the "poor" attitudes/morals/respect by the majority.

Have you been to Maceio? I found people there to be superbly respectful and considerate. Sorry to hear about your problems. My guess is that you live in Natal, right?

No, I'm not asking of a place FREE of these things, don't take my response to the extreme. But I certainly don't like living in one of the most corrupt and violent countries on the planet, and that is brazil. It was just announced on the news tonight that the United Nations is coming to brazil to investigate corruption!!! The FIRST country that the U.N. has gone to to investigate corruption outside of AFRICA!

Brazil is he fifth largest country in the world and the scale of corruption is breathtaking as well as relativly easy exposed Brazil being a democratic country. Similar allegations or investigations of corruption could easily land to hasty and untimely demise of any and all "nosy" inquirers in, for example, Russia or Thailand.

UN could hardly be portrayed as a respectful and impartial organization; and I suspect that there could be some unrelated ulterior motives for turning spotlight on Brazil instead of Russia or Serbia. Now, I know that corruption is just as rampant in the United States and Europe albeight in different and more subtle forms. Hell, UN itself is corrupt to the core.

I´d lived in the former Soviet Union, Italy, Austria, the United States for extensive periods of time. I worked in two dozen countries all over the world for slightly shorter periods. I like Brazil and I´ve settled down here for good by choice. I feel safer in Rio then I do in New York, LA, Miami, or Moscow. I would probably feel safer in Sweden with virtually no crime and all the social safety nets in place, but then... I´d be in grave danger of committing suicide like many of the Swedish do in record numbers. Actually, Sweden has lower suicide rate then France, Finland, Austria, Denmark, and Belgium.

Of course, Brazil has tons of problems and it can be dangerous and rough. Yet, it is still a relativly free world. If you can afford an expensive place in NE of Brazil, you could probably afford a modest dump in some European safety heaven.

Have to 100% disagree with you there. Quality, as in product quality, is measurable, it's not subjective.

We are not talking product quality here, more a quality of life which is highly subjective. People choose different environments looking for different objectives and pursuing different goals. Quality of life is too closely associated with human values, ideas, and ideals in human experience to be treated as allegedly cold and impartial quality of a stand-alone product.

quote:

"We are not talking product quality here"

yes, the response to my statement was about brazil being "inexpensive" and I stated that many products here are more expensive and of inferior quality, and a response was given that quality is subjective. If that was you that made the response, it wasn't clear what you were talking about.

And yes, I've been to maceio, at least 20 times, I live 3 hours to the south, in Aracaju. And I'm sorry boris, but I spent the first 34 years of my life in the U.S. Now let's not talk about New York City, or Miami, because those two cities are DIFFERENT than any other place in the U.S. And I lived in upper class neighborhoods while in the U.S., in Atlanta Ga. as well as Naples Florida. And I still have my residence in the U.S., quite a nice one by the way, so no worries there. In all my years in the U.S. there may have been a couple instances, meaning 2 or 3, where one would consider calling the police or go to the neighbors to complain. Here, it's every week! And Maceio, Sao Paulo, Rio de Janeiro, Natal, Recife ALL have the same problems of people not respecting one another nor the law. It may be a little better in some places, but it's still the exact same problems, just some a little worse than others.

Would you concur that there is nowhere in the entire country of brazil, the fifth largest country as you said, where people have respect for driving laws? Do brazilians think they're just not important? Yes, they do, until one of their children or family members gets killed in a car accident. Just had my second friend killed in a car accident here last weekend....it's insane. A huge truck ran completely over top of his car, the truck was in the wrong lane trying to pass 10 cars at once on a hill!!

quote:

Now, I know that corruption is just as rampant in the United States and Europe albeight in different and more subtle forms.

It's a real shame that that's your opinion, you're either ignorant about the depths of brazilian corruption or american corruption. As far as corruption is concerned, I sure hope you don't try and conclude that Brazil and the U.S. have the same problems in respect to the amount and severity of corruption. You don't see politicians on every level of gov't. getting accused, and then absolved, every other day. Corruption and impunity in brazil will be the demise of this country if things don't change for the better soon....they can't get worse, the economy, as well as society, won't be able to bear it. The U.S. doesn't have LAWS that actually protect their politicians from prosecution for corruption. Corruption in brazil is a joke, the laws are a joke, politicians and the upper class have no worries, they have carte blanche to steal whatever they like, because IMPUNITY is the soup du jour for them. Believe me, I know what I'm talking about, I have "friends" here in Brazil, I'm one of the handful that pretty much can do whatever I please, but that doesn't mean I like it, nor think its right.

While corruption exists in the U.S. in the form of lobbyist groups, public monies as a rule are not stolen. Now I can just hear the normal brazilnutz start screaming Enron now, and Enron executives have been/are being prosecuted. Hell, the CEO just died of a heart attack from the stress because he knew he was going to jail. In Brazil he'd be at the local therma laughing it up with his senator, as long as the politicians got their cut they'd probably give him a medal. Then one has to worry about reporting on the corruption, heck a brazilian journalist just went into hiding, and a couple weeks ago another kidnapped and held hostage to get airtime on Globo??

And as far as safety?? You feel safer in Rio than in New York City?? NYC is now one of the safest large cities on the planet, and Rio? One of the most violent cities on the planet. Does one hear of kidnappings as a matter of commonplace in New York City?? The U.S.A.?? In Rio? In Sao Paulo? One of my best brazilian friends lives in a beautiful apartment in barra, he's been there for the last 15 years, ask him about safety in Rio de Janeiro.

You're very right about one thing though, quality of life is subjective. My question is this, how can one have a better quality of life coming from a first world country, where poverty is minimal, where they have minimum wages that are at least survivable/livable, and expect to go to a third world country where close to 25% of the population survives on less than $2/day, where corruption is rampant and invades every facet of local, state, and federal gov't., the police force and the justice system. Where you have a handful that have cash and the vast majority are poor and for many when the opportunity presents itself to rob some "stupid" gringo it's fairgame. Where when the foreigner gets pulled over by the police he'll let them go for a "cerveja", where the price for a piece of property for me, or other gringos, isn't the same for a brazilian. Where when you buy a piece of property NO ONE wants to put the real price on the land title/deed, don't ya think that after a couple 24 hrs. that the gringo gets a bad taste in his mouth? Where he just might think, "hey, these people think we're stupid, there are people trying to take advantage of us at every corner."

You typically don't have this behavior in first world countries. I can take a toothless brazilian from the interior of Amazonas to New York City, or Jackson Mississippi, and go to buy a car, that car will be the exact same price for me(an american), as it will for him. Generally speaking, that's the opposite of how things work here in Brazil.

Now, your market is people looking for a "cheaper", "better", "higher quality of life". I'm assuming this includes foreigners. Tell me, do you think that your typical gringo with money isn't a target for crime in brazil? I have British partners in my business here in Brazil, they're all wealthy. When they come to Brazil I have to always physically take the watch off one of my partners wrist...it's a $40,000 rolex. But he wears this watch all the time in England, and also in the U.S. without any worries of being robbed, hijacked, kidnapped, etc. One CAN NOT do that in Brazil. So, one has to change his behavior in Brazil, for many that's not easy, especially older people that are accustomed to their ways. Someone like my one partner whom I'm building a mansion here for will more than likely have to have a bodyguard while he spends his time here and if he decides to spend any significant time in Sao Paulo it would be smart for him to have bulletproof glass put in his car there, Sao Paulo as I'm sure you know is the #1 consumer in the world of bulletproof glass. Then while in Sao Paulo one must be careful of public transportation since one never knows when the next revolt of the PCC is going to take place. But naturally it won't last long, as the politicians will "negotiate" with the criminals and reinstate their cellphones and their "leave" for X-mas vacation.

Is this quality of life? Seriously, I would like to know your honest opinion. I understand you may not be able to answer honestly here, afterall, you have a financial interest in "selling brazil". But you know what Boris, so do I!! Can you believe that? My partners and I are building 105 houses in three housing condominiums here in the northeast and selling to the british market. But ya know what? I won't lie to them. I won't tell them that this is a good place to LIVE, meaning 12 months, 365 days a year. Vacation?? Hey, all for it, one month a year, maximum 2 months, why not. But to live in Brazil? Send your children to school in Brazil? Be wealthy in Brazil? Live in a walled community or a house that appears you're in prison when you gaze out the windows. Or as I'm doing, living in an apartment with people above me, below me and on the side of me, and my apartment would be more than a "modest dump" in the U.S. I paid $400,000 US, in cash for my apartment here, as you well know that in most places in the states, Manhattan, Beverly Hills, or Port Royal Naples excluded, $400K buys a nice house, with a yard, without walls, iron gates, and nails/glass sticking out of the top. Speaking of me paying in cash, as you also know that is absurd in any first world country, especially the U.S., if one has cash in the U.S. you certainly don't buy "a vista". You can make more cash in a typical diversified stock fund in the U.S. than the 6% interest you'll pay for a mortgage, and spread out over 30 years no less if desired.

To each his own Boris, happiness is what it's all about, life is short. But here where I live, and I haven't seen significant differences in all the places I've been in brazil, the environment is difficult for a person that is respectful of others, the law, property, etc, AND only expects the same in return. I've even had other brazilians that I know that live in Sao Paulo and one from Curitiba that asked me, "how do you live here?" Telling me that they could never live here, and they're brazilian! And this is a city that boasts, flies flags from the street posts, "Melhor qualidade de vida em nordeste Brasil!" And that is a title that was given to them, it wasn't self-proclaimed, by whom I have no idea, actually heard one person say the U.N., lol.

As I stated before Boris, and I truly hope you believe me when I say this, I do not take any pleasure in stating what I have. I have a child here in brazil, with a brazilian ex-wife, who thinks this city is shangra-la. So whether I get on a bird and take my ass back to the U.S. I'll always be tied to this place, my problem is my child. Why does she have to be subject/influenced by these behaviors/attitudes that truly are disrespectful. Why does she have to be at risk when she becomes 16 and is able to drive a car in getting killed by some ignorant idiot that has no respect for human life let alone the law and doesn't even think at stopping at stop signs, driving the speed limit, staying in his lane, etc, etc. How can I expect to take my daughter to the U.S. and teach her respect, consideration, to trust others and her see respect as well as responsibility for one's actions in action in the U.S. only to return to brazil and it all goes out the window. Then you have to remove your jewelry, drive a modest car, "dress down", hide the fact that you have money or you may become a kidnap victim. These are real threats in brazil, not so much in the U.S., as MANY people there have very comfortable lives and one actually has a police force that doesn't close down after 6 pm and can be relied upon to protect them, not extort them.

Hello - Very interesting loop. I would like to know if anyone has an opinion on the lifestyle that pursues pousada ownership in the northeast. A little of the beaten path - that is, not in Natal or even Pipa, but a little more remote. Consider investing $500,000.00, either by purchasing an existing turn-key operation or by building/expanding into a luxury pousada - beachfront. The question is, to what extent would you surround yourself with danger, corruption, etc. if you were to show respect to others, build relationships with your suppliers/dealers and don't run around in rolexes. You would not be living in a metropolitan area. If you know Jericoacoara or the province of Algoas, that is what I'm talking about. Thoughts? Thanks!

No question it sounds appealing... but if I had a dollar for every pousada that went belly up in Brazil this year, I would probably be able to buy a nice mid-size car... It is tragic and ironic, but many people sink their life-savings and retirement funds into this elusive dream, just to be hit hard with cold and tough reality of running business in Brazil. Running a pousada is by far one of the most difficult and challenging types of businesses that a Brazilian could choose to invest in. This is much more difficult and problem-laden for a foreigner who is more likely not to speak the language, not to understand business culture, and become subject to some "uncoventional" business competition methods.

I think that only a tough individual (company) with significant experience in customer service, who has local connections and has done exhaustive market analysis and preparation has a fair chance of success.

For anybody willing to risk their assets and sanity I would suggest leasing a pousada for a year or two before buying. Or even volunteering to work with a perspective establishment for a few months in order to get some real world perspective.

Hi Boris,

I own a apartment in Rio. I want to transfer to my fiance. He is a American, but have a brazilian CPF, what should I need to do.

Hello Fabi,

I understand that you wish to transfer ownership of the apartment to your boyfriend. The best (most efficient and least expensive) way is to do Doação in his name. If you do Doação to him com Usufruto in your name you would accomplish roughly the same purpose while reducing your ITBI tax from 4% to 2%.

Stop by at a cartorio and any competent tabelião should be able to guide you through the process.

Regards,

I wonder if you can help me in learning if it is possible to list a one bedroom condo for rent, during your winter months, in Florida. Is there a magazine or newspaper read by Brazilian professionlals who might want to vacation for a month in Florida by the ocean?

I recedntly got married in Brazil and we are buying a nice home in OURO FINO MG. The purchase price is over $100,000.00 and I don't want to be robbed by a bank. What is the safest and cost effective way to transfer funds .. Draft or Wire?.... and are some of the online agents actually cheaper? Also I have applied for a CPF number and would like to have the title transferred in my name and my wife's name as joint tenants. What is the name of that type of deed in Portuguese?.
Thanks,
John

Hi John, hope you are moving to Ouro Fino Sul de Minas and not north of Belo. Who did you marry there? I married my wife over 35 years ago and vowed to retire their. We finally made it back a little over three years ago. We don't have many foreigners living there so it will be nice to welcome another one. I think you will love Ouro Fino especially if you don't have to work there. If you married into one of the families there you will find it very easy to adapt. We are currently in LA where our kids live but will be back in November. If you are around please give us a call. Our number there is 2080. Gil

i bought property in bahia near cumuruxatiba its about 75 acres on the ocean.the problem is it was afermative action property.i was told that the presadent allect was going to give the owners the deeds as a gester of good faith? did this happen? i was told it would be givin to the origanal owners? where does this leave me?

i have property in bahia but still live in usa .i bought the land to retire too.the taxes were cheep enough to keep it untill i got there.the problem im having is keeping homeless from invaiding my land.what is the legalities of my problem? how do i keep them off or how would i get them to leave whem i get there ?do they have any legal right to stay there? i dont want a pistilaro shooting me for land.

Hi Gil,
I married Erika Rocha. Her family lives accross from the Montanes Club. Truly great life there. Slower than I am accustomed to, but I will get used to it.I don't have to work there as I have a secretary in the USA who can get my business done with some internet assisted guidance I'll call you when I get back after the 15th of November. Take care!
John

I bought a house in Uberlandia, MG.
What is the fee rate for a title or deed ?
Thanks.

Great article. He's a great professional and doing a lot to raise the quality of real estate services in Brazil. Thanks Boris!

Now, if anyone would like some professional guidance here in the US, please take a look at our website: www.investinbrazil.com - We are a US-based real estate agency, working with some of the largest Brazilian real estate developers to help foreign buyers find their dream home in Brazil. We're happy to answer your questions.

Hello David R,

I am not sure what you refer to as fee for a title or deed. Do you mean the fee for ESCRITURA and REGISTRO? Then the best way to find out is to stop by at a local notary office (tabelionato/cartorio) and get the prices directly from the horse's mouth. This fee varies from state to state. I am not sure what the values are in Minas. Whatever it is, the fees go up every year usually starting in January.

Regards,
Boris

Hello Marcus,

... and thank you for your kind words.

I highly recommend your web site and services (no, I don´t get anything out of this free publicicty) and I am looking forward to working with you. Hopefully, we will be able to bring some quality to real estate services in Brazil.

Hi Boris,

First of all, thanks for such a great website full of good information. I am a large buyer of real estate in Buenos Aires and Punta del Este. I didn't expect to buy real estate in Brazil but I'm here in Florianopolis and fell in love with the great city and the beaches and now looking to purchase here. I've been busy reading various websites. I didn't find anywhere that tells what the Capital Gains taxes are when you sell. Can you provide that? The realtor told me today it's 15% but I can't find any documentation on that. Also, are there any other taxes or expenses when you sell other than the realtor's fees? Thanks.

Dear Boris,

Amazing web, I am in love with Brazil, and in the summer went to Kurotel, a delicius place to feel healthy. I am half time between Punta del Este and Buenos Aires, but we will go for sure this summer.
Thanks for all your info.
Patricia