Brazil property prices currently present an attractive investment opportunity for foreign investors due to Brazil’s weak currency, particularly if you’re an investors in from Britain or the USA. With Brazil’s currency currently standing very weak against the British pound and the US dollar, investors are enjoying house price bargains that are very rarely seen in Brazil.
It has been widely publicised recently that the Brazilian Real has weakened against the British pound and the US dollar over the last 12 months (June 2011 – June 2012). For instance, during the summer of 2011 foreign investors could get 1.56 Reals for each US dollar, however, in today’s market, investors can expect to get two Reals per dollar.
What this means in terms of house prices in Brazil is that a house that cost approximately 200,000 Reals back in 2011 would have cost $128,205 in US Dollars. In today’s market the value would be around $100,000.
Based on these figures alone, the strength of the British pound compared to the Brazilian Real, means that for British investors looking to invest in Brazil property it is in fact even more affordable and therefore, a much more attractive proposition.
Although many would perceive a weakening currency to be a negative issue, from a positive perspective the declining value of the Brazilian Real means that Brazilian products are much better value for money, which has encouraged phenomenal growth across the Brazilian industry sector.
In turn, the growth of Brazilian industry increases the level of Tourism to Brazil, with tourists attracted to Brazil to buy up cheap products. What this means for the Brazilian Real Estate Market is that commercial property becomes attractive to investors. With tourism comes the need for hotels and holiday homes and foreign investors can snap up bargains on private and commercial properties and land plots in a bid to take advantage of Brazil’s lucrative real estate market.
In 2011 alone, Brazil’s Ministry of Tourism reported 5.4 million visitors to the country, which is a massive increase on numbers from 2010. On the back of this growth, a number of massive hotel chains have bought land and property across Brazil in order to cash in. Tourism levels look set to increase due to major sporting events arriving on Brazilian shores in 2014 and 2016.
This level of investment has meant that Brazil’s construction industry and housing development companies have also seen growth in the levels of work available to them.