FAQ's
Please click on the following links or scroll down for more information:
How do I get to Bahia from abroad?
How do I get to other parts of Brazil?
How do I get to Bahia from other parts of Brazil?
Are there any other relevant travel statistics?
How the process works?
Do I need a lawyer?
What will be the costs of purchasing the property?
What taxes will I occur on selling?
What fees do we charge the seller?
Are there benefits of giving Brazil Bahia Properties exclusivity to sell your property?
What time zone is Brazil in?
How long does it take to fly to Bahia from Brazil and internationally?
Once I have made a purchase is the money safe when I wire it over?
Is it is possible for foreigners to take out a Brazilian mortgage?
What is rental potential like?
How accessible is Bahia?
What is Bahia’s Climate like?
Does Bahia suffer from any natural disasters?
Once you own a property what expenses and taxes do you incur?
What is a CPF number, how do I get this?
How do you go about buying off-plan property?
How does it work buying second hand property?
How do I get permanent residence in Brazil?
Are there any environmental restrictions on development?
What is CRECI? Why is this important?
Why not buy in the Caribbean as an alternative?
Why not buy somewhere else in Latin America?
Are there dangers of fraud and deception?
Is the property market safe and legally secure?
Is foreign investment encouraged?
What is the bureaucracy like it Brazil?
Will the property be freehold?
Many urban myths exist about crime, how true are these and what is the reality?
Is the gap between rich and poor as great as people say?
How do I get to Bahia from abroad?
The accessibility between Europe and Bahia is increasing all the time, with Salvador the main hub for international arrivals; it is undoubtedly one of Brazil’s finest airports. Similarly, with package holidays rapidly increasing and huge development of tourist infrastructure, expect direct charter flights from the USA to emerge rapidly.
Whilst Porto Seguro is also an international airport, it is not of the same scale; however it still receives charter flights from Europe - expect these to increase in numbers when the airport upgrade is completed.
Regarding flights, we will endeavour to give you all information known to us, however due to the ever expanding tourism and hotel development, charter flight to and from Salvador are increasing all the time. Similarly, this increased demand means that there are regularly new flights announced by the conventional airlines, so please do not take this list as comprehensive.
Conventional airlines which serve Salvador include:
- Portuguese national airline Tap, which has frequent and regular flights from Lisbon, with a connecting service from the UK.
- Spanish airline Air Europe, which has frequent direct flights to and from Madrid, with connecting flights from all over Europe.
- German airline Air Condor, which has regular direct flights from Frankfurt, with connecting flights from all over Europe.
- Brazilian airline Varig, which offers direct flights from London and Lisbon.
- Brazilian national airline TAM, which offers direct flights from Miami.
- Brazilian national airline TAM, which offers direct flights from Paris.
- Brazilian airline Gol, which offers direct flights from Paraguay and Uruguay.
Charter airlines which fly to Salvador
The beauty of Bahia is as well as the conventional airlines, it is possible to get direct flights through Europe’s many package holiday companies, who offer seats on their chartered services. These flights run through the season where European’s visit Bahia’s holiday resorts, i.e. from March to September. The beauty of these flights is the cost, surplus seats on charter flights are often very cheap to purchase – even at late notice.
Some examples include:
- Iberworld, which flies regularly from Madrid.
- Blue Panorama, which flies regularly from Milan.
- My Travel, which flies regularly from Manchester and London.
- Livingston, which flies regularly from Milan.
- Parmatur, which flies regularly from Milan.
- Edelweiss, which flies regularly from Switzerland.
- Arkfly, which flies regularly from Amsterdam.
- Tui, the world’s largest travel company, which is about to begin regular flights. (They are developing a huge hotel complex near Praia do Forte).
- Airtours, which has regular direct flights to Salvador from the UK.
- Thomas Cook, which has regular direct flights to Salvador from the UK.
How do I get to other parts of Brazil?
For various reasons many international visitors to Brazil may opt to fly into the South of the country, where the major cities are connected to all over the world. Many of Europe’s and the USA’s major national airlines fly into Brazil’s Southern cities, particularly Sao Paulo and Rio de Janeiro. From here it is possible to get one of many connection flights to Bahia. (See question below).
How do I get to Bahia from other parts of Brazil?
As Bahia is the number one holiday location for Brazilian’s, it has outstanding connections with the rest of Brazil. Although these change all the time, we have compiled a spreadsheet to give you an idea of what routes exists and who flies them, as well as the websites and contact details for these companies. As well as the international airports of Salvador and Porto Seguro, it also boasts regional airports at a variety of locations, including Ilheus, Lencois, Paulo Afonso and Valenca.
Are There Any Other Relevant Travel Statistics?
Tourism Agencies in Bahia
- 1979 – 38 agencies.
- 2005 – 689 agencies.
Airport Traffic at Salvador International
- 896% increase between 1979 and 2005.
- Salvador is 3rd most busy airport in Brazil for international visitors and the number 5 for national passengers.
The first process for a foreign investor is to gain a CPF number, similar to a social security number. This is a unique number which allows the investor to be identified for title and taxation purposes. A Brazilian lawyer can obtain this within a few days and the process can be completed from your home country once power of attorney is ceded to the lawyer.
After this, it is normal to draw up a contract of sale, which details all conditions of the sale including details of the deposit paid. The sales contract can be signed either in person, or if power of attorney is ceded, by a lawyer. Following this transfer of title is arranged, which can take anything up to a couple of weeks.
We have an extensive network of independent lawyers and we can recommend these accordingly; we always advise clients to take legal advice. Brazil Bahia Properties are happy to deal with the administration and paperwork in any transaction.
What will be the costs of purchasing the property?
Expect to pay around 7% to complete the transaction, broken up as follows:
- Title Deed transfer, via the Notary. Around 1.25%.
- Registration of the deeds. Around 0.75%.
- Purchase tax – ITIV. Around 3%.
- Legal fees. Around 2%.
At Brazil Bahia Property we will endeavour to find you the lowest costs possible. (Contact us.)
What are the Transaction Costs?
Transaction costs in Brazil are made up of the following: (these can all vary slightly depending on location and individual circumstances)
• ITIV - (Imposto sobre transmissão de bens imóveis) – This tax is a property transfer tax that is around 3% of the value of the property.
• Legal Fees – around 1-3% of the value of the property, but in simple cases it is easier and much better to settle for a small fixed fee.
• Title Deed and Registration of the deeds: Once the title deed has been registered, then the notary public will charge a tax according to a sliding scale. However the final result is usually less than 2%. Often the title deed may cost 1.25% of the value of the property and the registration of the deeds 0.75%.
• Laudenmio - On the beach, the first 30 meters from the high tide line technically belong to the Brazilian state – called the Zona Marinha. A buyer can obtain private use by paying a small annual occupation tax to the government for private use (Foro – see below). When an owner sells this private use, the government is entitled to 5% of the value of that right; called the “laudemio”.
Total taxes and costs: The above usually equates to around 5.5 to 7.5% of the value of the property (excluding Foro and Laudemio which are only for beach owners). We can advise you how to reduce these costs, whilst still getting the best advice.
What taxes will I occur on selling?
Capital gains on property in Brazil are taxable, to both Brazilians and foreign investors alike. However the rate is set at only 15% (dependent on any double taxation treaties your country may have) and this can be avoided completely if you:
a. Reinvest the proceeds in Brazil.
b. Hold the property for five years.
What fees do we charge the seller?
We are confident our commission is the most competitive in Bahia. Please feel free to contact us for further information.
What are the benefits of giving Brazil Bahia Properties exclusivity to sell your property?
Clearly there are benefits of giving us exclusivity rights to sell your property. Although we endeavour to market and rapidly sell all properties on our site, with exclusivity we also assign you to our specialist marketing team, who provide a more specific, in-depth and tailored approach to marketing. This team specialise in selling high net worth properties, and will guide you on all the possible strategies available to you. Although we do not necessarily require exclusivity for you to use these services, it will clearly be reflected in the fees we charge you.
Bahia is only 3-4 hours behind GMT. This means the time differential between Bahia and the USA/Europe is never too far away.
How long does it take to fly to Bahia from Brazil and internationally?
Domestic:
To fly to Porto Seguro takes only 1 hour from Rio and 1.5 hours from Sao Paulo. To fly to Salvador takes 1.5 hours from Rio and 2.5 from Sao Paulo.
International:
To fly to Bahia from Spain or Portugal takes around 8 hours and from the UK, 9.5 hours. This is less than certain destinations in the Caribbean.
Once I have made a purchase is the money safe when I wire it over?
Before a payment is made, we ensure that all the necessary title deeds and ownership rights are correctly transferred to the new owner’s name.
Is it possible for foreigners to take out a Brazilian mortgage?
Yes this is possible, once a permanent visa is obtained. We generally advise people to take out mortgages abroad with international lenders, as the costs tend to be lower and the process in Brazil can be quite bureaucratic.
What is rental potential like?
Rental potential in Bahia is excellent, due to the all-year round climate and ever increasing tourist numbers.
Bahia is highly accessible to both the domestic audience and the international long haul tourist fraternity.
What is Bahia’s climate like?
It is hard to imagine a better year round climate than that of Bahia. Although the summer months can be as hot as Rio, sometimes up to 30°C, temperatures in Bahia are rarely far from 27°C.
The coastal regions of Bahia experience a year round tropical breeze; this ensures the hottest days are bearable, making spending time in Bahia a pleasurable experience all year round.
Does Bahia suffer from any natural disasters?
Bahia is free of natural disasters. There are no hurricanes, volcanoes, tsunamis or earthquakes.
Once you own a property what expenses and taxes do you incur?
- Property Tax (IPTU – Imposto Predial e Territorial Urbano) – like a council tax – this is for urban property owners. Urban properties are subject to an annual municipality tax, which is around 0.6% of the official value of the property. However the official value is often much less than the actual value of the property.
- Foro – like IPTU but only for the ‘Zona Marinha’- waterfront zone of the beach. You cannot technically own beach front in Brazil and waterfront zone can only be leased from the Brazilian state (SPU) and that is why the FORO charge comes into place. This is important if you want to build on this area. However in many areas it is prohibited to build on the waterfront zone, and therefore there is no point in registering the waterfront with the SPU and paying this tax.
- Captial Gains Tax on Sale of Property – 15%. However no capital gains tax is charged if the funds are used to buy another property or if you hold the property for 5 years or more.
- Income Taxes - Income derived from property rentals, if declared, is taxed within the normal personal income tax system, which has progressive rates from 15 to 27.5% - if the owner declares it.
What is a CPF number, how do I get this?
- The only formality required is getting a “CPF” (Catastro de Pessoa Fisica). CPF is the registration number that you require for any administrative action in Brazil, for example, buying a house, car, getting a phone line or an electricity supply.
- A CPF number can be easily obtained online at the Receita Federal’s website or via a local Brazilian embassy, post office, Brazilian Lawyer, or good estate agent. Brazil Bahia Property are happy to help you obtain this.
- The CPF also means that you are required to complete an annual tax return – this enables the authorities to follow the development and evolution of a property as well as any income derived from it.
- The buyer can get a CPF from outside Brazil by hiring a good lawyer and giving them power of attorney.
How do you go about buying off-plan property?
- First make a property reservation with the developer, which is usually valid for 2 to 3 days.
- Sign a ‘reservation contract’ and pay a small deposit to secure the property, this amount varies but can be around £2000. Reservation contracts specify the date when the full deposit for the property needs to be paid. Usually 21 to 30 days from the signing of the reservation contract.
- The lawyer then confirms that the developer or current owner actually owns the property, has the correct title, and that there are no liabilities, such as outstanding bills on the property.
- The lawyer will also ensure that the property is registered in the new buyer’s name.
- If all is correct with the contract, it is signed and the money is transferred to the constructor account via the Banco do Brasil. If funds do not go through the Banco do Brasil, it makes it difficult to repatriate the funds overseas when the property is sold.
- Options usually exist for the buyer to make a payment plan with regular payment plans until the delivery date. Developers are also usually open to payment plan offers. Plans vary from one year to five years. However payments are usually subject to financial adjustment based upon an index set by the Federal Government. This is done to account for variations in the price of raw materials. This means that the final amount paid may slightly differ from the initial quoted price.
- The title to the property is usually transferred to the buyer upon completion of the build and receipt of the keys. This is the ‘Escritura Publica’.
- Upon transfer the ITBI tax of around 3% of the value of the property is payable to the government.
- Once tax is paid and property is transferred to buyer through the Escritura Publica, then the property is officially registered in the buyers name at the land registry office - ‘Matricula’.
- This final step incurs a further tax of around 2% of the value of the property. This is what guarantees the owners rights. This is a vital step as without it you do not officially own the property.
How does it work buying second hand property?
1. The buyer locates a property to purchase.
2. The buyer needs to register for a CPF number. (link to FAQ what is a CPF number, how do I get this?)
3. A contract is drawn up between the buyer and seller, called a private sales and purchase agreement (optional).
4. A small deposit (often around £2,000) will secure the property whilst your lawyer checks the documentation and the property particulars.
5. The lawyer will then undertake due diligence to confirm that the seller lawfully owns the property, has the correct title deeds, the plot is the correct size and that there are no liabilities on the property, for example outstanding bills. This generally takes longer for second hand property than on an off-plan build, as there may be more issues determining ownership. Clear title and any liabilities must be found out.
6. Legal costs can be around 1-3% of the property, or a small fee for simple deals. We will strive to minimise your transaction costs.
7. Money is transferred from the buyer’s international account - through the Banco do Brasil - into the sellers account.
8. Properties then exchange during the ‘escritura publica de compra e venda,’ which is a public sales and purchase deed.
9. Upon transfer, ITBI tax of around 3% of the value of the property is payable to the government.
10. Once tax is paid and property is transferred to the buyer through the Escritura Publica, then the property is officially registered in the buyers name at the land registry office, called the ‘Matricula.’
11. This final step incurs a further tax of around 2% of the value of the property. This is what guarantees the owners rights. This is a vital step as without it, you do not officially own the property.
How do I get permanent residence in Brazil?
- There are three main ways to get a residence permit in Brazil: as an investor, by marrying a Brazilian, or based upon work.
As an investor:
- The minimum requirement is to bring $50,000 into the country, to invest in a real business that generates employment, taxes etc.
- Buying a home does not classify, however the difference between a nice house and a guesthouse can be hard to differentiate legally.
- A clever lawyer can make the best use of this Brazilian flexibility. The buyer would need to set up a Brazilian company with $50,000 deposited and transfer the $50,000 from an overseas personal account into the company account. This can only be done with a Brazilian investor registration number that is obtained from the Banco do Brasil.
- Once the company is founded, the investor can apply for a visa at the Policia Federal, this is a five year visa.
Based on a fixed retirement income:
If a foreigner is over 50 and can prove a permanent, monthly income (such as a pension) of $2000, you can easily apply for a permanent visa as a retiree.
Are there any environmental restrictions on development?
Fortunately for tourists and property owners alike, Bahia has been very stringent on environmental regulations. This governs all aspects of development, we will be happy to talk you through this, or indeed send you further information.
Some areas of the Brazilian coast are protected as APA’s (Area de Proteção Ambiental). These are environmentally protected areas and are meant to preserve rare ecosystems and fauna or flora threatened by extinction.
APA’s include many rules about land use, lot sizes, ground occupation, paving etc.
APA’s are often controlled by the federal and state agencies like IBAMA, which is the environment protection agency.
The IBAMA has separate powers from the town hall authorities. The problem is that you can be granted permission to build by the local authorities but then be banned from building by IBAMA and vice- versa. This has caused a few problems in Bahia because ALL parties have to be in agreement. However in some cases, not all have been consulted, which could cause problems in the future. At Brazil Bahia Properties, we will make sure ALL checks are made for you, and ALL the correct procedures are adhered to. We are happy to send you detailed information on this.
What is CRECI? Why is this important?
Brazilian estate agents are regulated by a governing body called CRECI - Conselho Regional de Corretores de Imóveis.
Each qualified estate agent or business is licensed with CRECI and is assigned a unique number which is lodged at the Companies House. Many of our international competitors do not have this, which is detrimental in the local property market.
Why not buy in the Caribbean as an alternative?
The Caribbean property market has boomed for many years, it is vastly over priced and investment is flawed as the region is prone to annual hurricanes. Instances have occurred when property has been seized from foreign investors without compensation, accessibility is poor and the costs of living are high in tourist zones and the upmarket beach resorts.
Why not buy somewhere else in Latin America?
Most of the countries in Latin America have a multitude of reasons not to invest, and the ones which don’t are no way near as attractive as Brazil.
Are there dangers of fraud and deception?
Like any other property market in the world, there is always the danger of fraud and deception. However, this is a relatively small problem in Brazil, investing in property is safe and easy, and we will guide you through all stages of the process, ensuring all relevant checks are met and that you receive independent advice on all aspects.
Is the property market safe and legally secure?
Brazil has sophisticated and well developed property laws, similar to any Western democracy. The legal system is very robust.
Is foreign investment encouraged?
Foreign investors have exactly the same investment and ownership rights as Brazilians. Foreign investment in property, tourism and the economy in general is actively encouraged.
What is the bureaucracy like it Brazil?
Like any other emerging market, Brazil suffers from its fair share of administration and bureaucracy. Luckily at Brazil Bahia Property, we will advice you on all aspects of this from start to finish.
Will the property be freehold?
Property in general in Brazil is freehold, meaning you will own a 100% of your property.
Many urban myths exist about crime, how true are these and what is the reality?
The gap between rich and poor, along with poverty, inevitably bring a problem with crime. However, the extent of crime in Brazil is an urban myth. The majority of serious crime is confined to the highly populated Southern cities, mainly Rio de Janeiro and Sao Paulo, and indeed much of this is gang related rivalry, in the cities favellas or shanty towns. Crime towards tourists is very rare. Bahia is hours away even by plane, and is relatively low in the crime stakes. Salvador, like any other major city, receives its fair share of petty crime and its vast favellas mean it should be treated with respect and common sense. Outside of Salvador, crime is not really an issue, the people of Brazil are known throughout the world to be incredibly friendly, and indeed it is rare to see violence from a Brazilian.
Is the gap between rich and poor as great as people say?
Brazil is a country riddled in inequality. With the richest 10% of the population earning more than 50 times more than the poorest 10%. The huge gap between the rich and poor and poverty itself are issues Brazil clearly has to face up to. Brazil is home to more millionaires than anywhere else in the world – reputedly more than a million. Luckily Lula is doing his best to address these issues, with amongst other things, inflation busting policies and raising the minimum wage.
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