Why foreigners are buying so many properties in Brazil

In cities such as Rio de Janeiro and Florianópolis, the period was marked by a greater search for properties by professionals working from home and the so-called digital nomads. In the case of Rio, the local city council launched a program in 2021 to attract this type of professional. "The advances in sales are mainly identified in newly launched compact properties. In Ipanema and Leblon, research shows that 30% of these units were sold to foreigners", says the president of the Civil Construction Industry Union in the State of Rio de Janeiro (Sinduscon-Rio), Claudio Hermolin. The regional director of international relations at the Regional Council of Real Estate Brokers of Santa Catarina (Creci-SC), Marco Aurélio Lievore, pointed out that, in a survey by a real estate agency in Florianópolis, 83% of sales were to Argentine clients looking for apartments on the plant. "The vast majority of the projects sought are studios. There are many foreigners who spend their holidays here and then come looking for a place to live or invest", he says. Among nationalities, Americans and Argentines stand out among investments. Europeans from a series of countries, such as France and Switzerland, also appear among the main buyers, while there is still growing interest from citizens of the United Arab Emirates. Attractions in the global market Platforms also made the idea of ??buying a property in another country and earning income remotely more attractive. Furthermore, companies have been focusing on offering services to the external public, such as the management of these properties. Lobie, a company specialized in the area, points out that the participation of foreigners in its portfolio increased from around 2% to 18% in three years. Today, the company manages approximately 1,620 investor studios from outside Brazil. "The advantage of this type of property for foreign buyers is the attractiveness of the city: they can use it during vacation periods and major events and, when it is not used by the buyer themselves, it is a property in great demand", points out Hermolin. “The revenue obtained certainly pays for maintenance and leaves some profit,” he says. Among the advantages highlighted by Lievore are also exchange rate factors. In countries like Argentina, properties are normally traded in dollars, which makes transactions in reais in Brazil more attractive. Furthermore, the director points out great potential for appreciation in the Brazilian market, especially when compared to more saturated coastal regions in the world, such as Miami, in the United States, and the Algarve, in Portugal. There is also an ease in the procedures compared to other countries. "Brazil is an easy country to get residency in, it's something that helps a lot", points out Lievore. In the case of Santa Catarina, he points to a recent flow of Russians, which intensified after the war in Ukraine, and who especially aim to obtain a Brazilian passport. A resolution from the National Immigration Council (CNIg) allows foreigners who buy property in Brazil to request a residence permit. Individuals must purchase a property with a minimum value of R$1 million and with their own resources from external sources. Airbnb on the rise The Brazilian market is also the third in the world with the most Airbnb listings, behind only the United States and France, but with one of the fastest growth in recent years. Since 2022, cities like Rio de Janeiro and Florianópolis have had their listing offers more than double on Airbnb. In the case of Rio, the AirDNA platform records more than 60 thousand, while the capital of Santa Catarina has 36 thousand. As a comparison, in Barcelona, ??where the modality will be banned from 2028 due to the negative effects on the local real estate market, there are 26 thousand advertisements. "Brazil has been recording growth in ads above the rest of the world", summarizes Sofia Morais de Sousa, account executive at AirDNA. In addition to the municipalities mentioned, São Paulo also stands out in absolute numbers, with more than 61 thousand advertisements. Cities on the coast of Santa Catarina show comparatively more robust numbers. AirDNA records more than 10 thousand advertisements in Bombinhas, in the State of Santa Catarina, which has a population of around 25 thousand inhabitants. In a survey published this year, the Inside Airbnb platform listed the city at the top of the listing concentration ranking in Brazil, with 210.3 per km2. Next comes Balneário Camboriú, with 138.8 per km2 and more than 10 thousand active ads. In this case, the region is also known for its luxury launches, which are another source of attraction for foreigners. According to the construction company of Senna Tower, a project planned to be the tallest residential building in the world, 16% of the apartments already sold were to foreigners. There is a certain change in the profile of tourists in the country. In 2021, AirDNA registered less than 10% of foreigners as guests in Brazil. Last year, the number was above 20%. Still, it remains very different from Europe, where the domestic market tends to be less relevant. In the case of Spain, 80% of guests are foreigners on the platform, while in Germany