Wait, I Don’t Own That Property?

So you want to live in a condo overlooking the beach, right? Who doesn’t. And why not do it in Brazil? With so many new, modern buildings under construction, now’s a great time for foreigners who have considered investing in Brazilian real estate.

But when you sign the contract, are you really buying the property? Perhaps not.

It’s common for buyers in Brazil to sign what’s referred to as a Contrato de Promessa de Compra e Venda. It’s a contract in which the buyer promises to buy and the seller promises to sell the property. The word promise here is key. You are promising that you will buy the property. Even after you sign, the property isn’t necessarily yours.

Real estate in Brazil is transferred to a buyer after a deed (escritura) - a public document - is filed in a notary office (Cartório de Imóveis). Until then, you have nothing but a private, contractual right. In cases where a building hasn’t been constructed, it makes sense as you can’t transfer something that doesn’t yet exist. Only after the condo is built can you formally transfer the property.

The trick is making sure you’re actually on the deed at the end of the day. If you’re planning to buy a property in Brazil, make sure you understand what you’re signing. You’ll need to be the registered owner according to the public records. Otherwise, when it’s time to sell or rent the property, you could end up with nothing at all.