WHY INVEST IN BRAZIL

Brazil

"The property market in Natal is in it's relative infancy. The North East of Brazil is an emerging market success story in the making"

The South American nation of Brazil is much more than a place; it is a state of mind. It’s the magnitude of the rainforests, the beauty of unblemished beaches, the aroma of freshly grilled seafood, the stirring beat of the Samba, the hedonism of carnival and the cheerful zest for life. Brazilian tourist authorities are proud of the fact that 96% of tourists to the country plan to repeat the experience in the future, and it’s perfectly clear why.

Portuguese - speaking Brazil occupies almost half (47.3%) of the continent of South America and it is indeed the fifth largest country in the world beaten only by the Russian Federation, Canada, China and the United States of America. Crossed by the Equator, the Tropic of Capricorn and the flow of the mighty Amazon, the enormity of Brazil cannot be underestimated and like the giant statue of Christ the Redeemer surveying Rio de Janeiro below; guests are welcomed with open arms.

GEM Estates has been seduced by this country that taught the world how to play football and throw a party and has selected Natal – The City of the Sun – as a property investor’s paradise. Natal, capital of the state of Rio Grande do Norte, is located on the north eastern ‘bulge’ of Brazil, just five degrees south of the Equator, and it is famed for its beaches and pure air cleansed by Atlantic breezes. Natal is not only ideal for relaxing beach holidays lazing under endless summer skies but is also an emerging market success story in the making. Colossal amounts of government and foreign investment is piling into the region and the future is as bright as the sun that bathes it.

WHY INVEST IN BRAZIL

CLIMATE *****

Being just five degrees south of the Equator, Natal enjoys a semi-arid climate and the sunshine is directly overhead at midday for most of the year. Annual temperatures average 27ºC, never fall below 24ºC even on ‘winter’ nights and gentle Atlantic breezes temper the heat. Rainfall is minimal and this part of Brazil is reassuringly free from natural phenomena such as hurricanes, tropical storms, tsunami and earthquakes. To earn its five star rating, according to research from NASA, Natal boasts the purest air on the continent and second purest in the world losing only to Antarctica and there’s not much of a property market there.

ACCESSIBILITY ****

Natal is the closest part of Latin America to Europe thus drastically cutting down flying times to between seven and nine hours from most European cities. A wide variety of airlines serve the international airport of Augusto Severo from London including British Airways and Thomson Fly and at just three hours behind GMT jet lag shouldn’t rear its ugly head. From around June 2009, the brand new São Gonçalo del Amarante Airport will be open and at the same time become the largest passenger and cargo airport in Latin America, and eighth biggest in the world. Augusto Severo is already exceeding its capacity of 1.2 million passengers per year; São Gonçalo del Amarante will be able to accommodate five million. One star short of five as it is still a long haul flight thus eliminating the possibility of short breaks.

ECONOMY *****

Brazil’s economy is making headline news in journals across the world. Already the 10th largest economy in the world and one of the four largest developing economies in the world (joining China, India and Russia), Brazil will, according to Goldman Sachs, have the fifth largest economy in the world by 2050. The country is more stable than ever, has huge natural resources and expects to be self-sufficient in oil within one or two years. Foreign investment into Brazilian equity funds and indeed Brazilian property is steady and strong, inflation is under strict control, external debt greatly reduced and the economic outlook is very rosy. The real estate sector is poised for a boom thus earning Brazil five stars in the economy department.

TOURISM *****

Natal historically relied on sugar, cattle, fruit growing, shrimp farming and the production of sea salt for its livelihood, however tourism is the new mainstay. A Ministry of Tourism was only inaugurated in 2003, the main reason that people haven’t been holidaying in Brazil for years, but since then hundreds of millions of dollars have been invested in international tourism fairs, infrastructure and environmental preservation. The target is to grow tourist arrivals annually from the current base of 5.5 million to 9 million over the next couple of years. Between 2002 and 2005 the number of tourist arrivals for the state of Rio Grande do Norte increased by 134% and Natal is currently developing more than ten golf courses and investing 1.8 billion US dollars into new hotels and resorts which will push this figure even higher. To earn five stars Brazil also has a large domestic tourist market with over 1.7 million domestic tourists arriving in the state of Rio do Grande Norte in 2005.

PROPERTY MARKET *****

The property market in Natal is in its relative infancy and the coastline is almost development-free, supply currently lags way below demand. New development is springing up alongside sporting and leisure facilities but the authorities are paying great attention to the environment before granting licences - aesthetics and stability are of greater importance to them than squeezing every last penny out of every last square metre. Prices in Natal are incredibly low right now as it is just beginning to emerge, one bedroom apartments start from as little as 500 pounds per square metre, but outside investment in infrastructure, such as the golf courses and new airport, will increase demand for
property and inevitably trigger natura price hikes. Five stars as Natal has year-round rental potential and suits both audiences - the pure investor and also the dream holiday home hunter.