How to Buy Real Estate in Brazil as a Foreigner

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1. Do It Yourself or Hire a Lawyer

   It usually comes down to how familiar you are with Brazil and if you are comfortable with risks or not. Foreigners buying real estate in Brazil who speak some level of Portuguese with solid connections with locals may rely on realtors to help with some of the acquisition steps. This may be enough for smaller acquisitions, such as lots in the coastal areas of Brazil. Investors, risk-averse buyers, and those buying properties that represent a substantial share of their total assets should undoubtedly retain a lawyer.
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2. Obtain a Brazilian Tax ID “CPF”

   The CPF Tax ID card is one of the most important documents a person has in Brazil as it is used by both private and government entities to identify citizens. CPF stands for Register of Individual Taxpayers (Cadastro de Pessoa Física). Each CPF represents a unique number stored and validated by the Brazilian Federal Revenue. A card is usually issued along with the number upon application. You must have a CPF for purchasing a real estate property in Brazil. You also must have it for many other purposes such as opening a bank account or filing your taxes.
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3. Find the Ideal Property

   Brazil is a country with continental dimensions. Finding your ideal property will depend on your taste, goals, and financials. Learn about the safest areas in Brazil as well as the main property search engines that are used by Brazilians and foreign citizens alike. By following our instructions, you can even see property listings throughout Brazil in English. Pinpointing the ideal location as well as nailing the target property configuration will get you on track to buy your property in Brazil with the right foot.
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4. Check Property Records

   Once you have chosen your target property, you should obtain a copy of the property deed (“escritura”). The deed should have an exact description of the property, ownership, and if any major problems (e.g.: liens, usufruto, encumbrances, or disputes) are attached to the property. A clean deed should show no major issues, be registered in the name of the seller, and issued recently. You should avoid purchasing properties entangled with probates, divorcing couples, or any other complex situation. 
   Although some sellers will offer to give you a copy of the deed, we recommend that you obtain a copy of the deed directly from the registry.
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5. Make an Offer

   Making an offer will be the result of price research as well as negotiation between buyer and seller. Learn here the main aspects involved in the process of making an offer for real estate in Brazil. From the technical aspects of an offer to the cultural specificities of real estate transactions in Brazil.
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6. Draft Purchase & Sale Agreement

   The Purchase & Sale Agreement document addresses not only the terms of sale but also the timeline for the transactions and allocation of obligations and rights to the parties. Among other concerns, stipulate at least 45 days between the signature of the agreement and the closing to allow enough time for all the closing-related tasks to be completed. Never allow a realtor to rush you. Realtors in Brazil will invariably pest you until you either sign a contract or tell them not to rush you. Realtors may lie about the existence of other interested parties to push you to make a deal.
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7. Have Documents Prepared to Be Accepted in Brazil

   For documents to be acceptable in Brazil they must have been at least sworn translated into Portuguese. Sworn translations are provided exclusively by Brazilian sworn translators registered with the State Commerce Boards. Additionally, most registries in Brazil will also require that the foreign citizen’s documents are validated through the Apostille method.
   A key point is to run your plans to legalize your documents with the cartorio in charge of the closing upfront. This way you can have their commitment that they will accept your documents when the closing comes.
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8. Obtain a POA – Power of Attorney Valid in Brazil

   A POA is needed if you want your lawyer or someone from your network to participate in the closing on your behalf. The registration is a formal procedure that is usually done in the same registration office in charge of the real estate. For a POA to be valid in Brazil, it must be a “Public POA”. Public POAs may be done in Brazil, or in a Brazilian consulate or embassy as long as the grantor is a Brazilian citizen. For foreign citizens, whenever doing a POA abroad, some very specific steps in their home countries for a POA to be acceptable by the registration office in Brazil.
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9. Provide a Downpayment

   In Brazil, it is customary to provide a downpayment as soon as the Draft Purchase & Sale Agreement is signed. The amount to be provided varies greatly. Amounts going from 5% to 15% are most common, although other amounts may be negotiated by the parts. We recommend that you pay no more than 10% as a downpayment. You should hold most of the payment until the closing as this is the most effective way to reduce the many purchase risks involved. Important: there is practically no title insurance or escrow accounts in Brazil. 
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10. Obtain Certificates for Property and Seller

    Clearance certificates must be obtained regarding both the property and the seller. The registration office will require some of such certificates to be presented during the closing. So, in addition to showing that many of the potential legal issues don’t exist (e.g.: unpaid taxes, labor disputes, etc.) such certificates are also a formal requirement for the closing. When we conduct our due diligence procedure, we obtain and assess more certificates than the minimum required by the registration office. We do so to cover more potential issues that may exist in addition to the more basic ones. More on:
    certificates on the seller and certificates on the property.
    
    

11. Prepare for Closing

    Once you have signed the contract, the clock starts to tick. Sellers will usually add to the contract penalties in case you are not ready for the closing by a certain deadline. A checklist with all the items required for the closing may help you and your lawyer control everything that should be ready by the closing date. At this stage, the realtor supporting the seller will usually coordinate with the registration office to obtain the estimates for Taxes and Registration costs and also a target date for the closing.
    You can learn more about the preparation for the closing and see a sample Closing Checklist to use when buying a property in Brazil.
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12. Pay Registration & Taxes

    Before the closing, you will be required to pay the main transfer tax known as ITBI or “tax over the transfer or a real estate property”, which is around 3% and is set up at the city level. Other taxes and fees apply. As a rule of thumb you may want to provision 4% to 5% of the property value for these costs.
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13. Have the Public Deed of Sale Reviewed (“Minuta da Escritura”)

    The public deed of sale (escritura) is available for a lawyer to review prior to the closing itself. Two main reasons for getting such review by a lawyer are:
    
    (a) to make sure that the document represents the correct property details as well as sellers, buyers, and amounts involved; as well as representations by the seller that will allow the buyer to seek compensation from the seller if a third party files a claim in the future; and
    
    (b) confirm that all the “certidões negativas” are completely clean. Is not uncommon for missing certidões negativas or certidões negativas that uncover a problem with the seller or the property to be disclaimed in the escritura. If you sign an escritura with such disclaimer, you are basically stating that you are aware of the “problem” and assume all the risk deriving from such disclosed problem.
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14. Attend Closing, Pay Balance, and Record Deed

    The closing will usually take place at the registration office in charge of the “Escritura”. For the closing to happen, the fees and taxes will have to be paid and confirmed previously and all the required clearance certificates filed with the registration office. Some registration offices will read aloud the “Escritura” document and then ask for the parties to sign it. In our practice, it is only at this stage that we release the payment to the seller.
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