Heated Debate

A heated debate is taking place on the following forum:

http://www.totallyproperty.com/brazil-property/3121-banana-residential-club-6.html#post10823

People who have visited the Banana Club site have varying opinions as to how desirable it is. They basically range from 'highly desirable' to 'steer well clear'. It is good to hear different peoples views although you have to bear in mind that some posters have hidden agendas, e.g., some of them may be real estate agents with a vested interest in a particular development.

If anyone reading this has visited the Banana Club site please feel free to post your comments.

Thumbs Up For Brazil

Goldman Sachs high flyer Jim O'Neill once again gives the thumbs up to Brazil. Although he concedes that Brazil has not done as well as the other BRIC countries he claims that he is optimistic about Brazil's future and is considering buying a second home there.

He thinks that Standard & Poor will probably upgrade Brazil to full investment grade status in 2008.

Source: Mail on Sunday, 8th July 2007.

Interesting Website

I came across an interesting website called Escape Artist today. Although it is aimed at Americans wishing to emigrate it contains some interesting articles on Brazil such as:

Be wary about stated sizes of property.

Finding reputable real estate agents in Brazil.

An ex-pat documents life in Fortazleza.

Beachfront -v- Lagoonside

I have found a couple of forums which include quite a few posts on buying property in NE Brazil:

Channel Four Forum

Totally Property Forum

One of the posts, made by a real estate agent, pointed out that Banana Club is relatively cheap because it is not beach-front. I think that, while beach-front properties are highly desirable to some people, the beach is not everyone's cup of tea. Perhaps people with children would prefer the relative safety of a lagoon. Or maybe those sampling water sports for the first time would prefer a calm lagoon rather than the rough sea to practice in? When purchasing any property there is always a trade-off. Beach-front and get a one bed apartment for your £50k or lagoonside and get a three bed villa for your £50k?

Will a beachfront property achieve better rental yields? Will beachfront result in higher capital appreciation? Only time will tell.

Delay

I was telephoned yesterday by Carola at Property Showrooms who informs me that there will be a delay in the initial contract, apparently because some title insurance is being arranged over each individual plot. I know there are firms in the UK which provide insurance policies for clean commercial titles so perhaps this is similar. In any event, it means that I do not have to part with my 21,500 euro quite as soon as expected so I am not unduly perturbed!

The Plunge

There is not much more I can do to minimise my risk so I choose plot 21 in phase 3 and fax through the relevant forms with a copy of my passport to Nicky. Again, she provides an excellent level of customer service by confirming that all the paperwork has been received and is correct. I pay my 1,000 euro by credit card to Legalex, a firm of Spanish lawyers. I very quickly receive some information through from Manzanares lawyers in Spain, who have an office in Brazil. I know it is probably good practice to try and hunt down my own independent English speaking Brazilian lawyer but my workload in my day job means that my time is limited. I take the easy option and instruct Manzares to act on my behalf. Their fee will be 1,500 euros plus VAT for the whole process. There will also be disbursements on top of this for:

1) Notary and registry fees

2) Transfer tax on completion.

3) Search costs.

4) Bank commissions.

According to my email from Manzanares there are a number of steps that they handle in the property purchase:

1) Reservation of the property, which I have already done.

2) Legal searches, similar to those in the UK.

3) Application for a tax number after granting power of attorney to Manzanareas.

4) Check that building works are on schedule before stage payments are made.

5) Completion.

6) Registration of the property in my name.

7) Setting up of direct debits for utility bills.

Links Policy

I think I had better explain my links policy at this juncture. Wherever I can, I am linking to other websites that you might find useful. Some of these websites run affiliate programmes and I make anything from a few pence to a few pounds if you click through and make a booking or a purchase. I am, however, only linking to sites from which I have received good service. For example, I enjoyed my stay at the Sofitel in Salvador and thought it was good value for money. I am linking to them and I will receive a small percentage of any click-through bookings. I am also linking to a small pousada in Maracajau because I enjoyed my stay there but I receive nothing from them, so I don't make money on all the links. I am not linking to sites where I did not receive good service or which I do not consider to be good value for money. I am not receiving any money from Property Showrooms. I am linking to them because they have provided a good service, so far. Neither am I receiving any money or inducements from the developer of the Banana Club or the developer of Porto Dos Corais.

I will do my best to tell things 'as they are'. If you think I have got anything wrong or have been unfair in any way please feel free to post.

The Agent - Property Showrooms

The development is being marketed by Property Showrooms who have produced a very impressive e-brochure. I ran a credit check on the agent even though no money passes through their hands. My logic is that a disreputable agent is unlikely to have any qualms about dealing with a disreputable developer whereas a reputable agent is more likely to only want to deal with a reputable developer. Agents registered in the UK can be checked for as little as a fiver at websites such as Instant Report. International agents can be checked out at websites like Skyminder, although international credit checks can be expensive and can take a while to come back. The credit report that I obtained on Global Prospects SL, the Spanish limited company through which Property Showrooms trade, can be summarised as:

1) The company was formed in December 2004.

2) The company is based in Malaga on the Costa Del Sol.

3) No legal actions have been registered against the company.

4) The company has a weak balance sheet, but this is normal for service companies.

5) The company turned over less than 10,000 euro in its first year of trading.

6) The British directors of the company are Stephen James Binge and Daniel Michael Bance.

I also Googled them, but thankfully could not find any adverse information. In my dealings with Property Showrooms I have been speaking with a very helpful British woman called Nicky Segal. I found her knowledge a bit lacking (or perhaps I have just been trained to ask awkward questions) but her customer service skills more than made up for this. When she couldn't answer a particular question she always came back to me promptly with an answer from the developer. It would be easier for me to communicate with the developer's English speaking representative direct, however Nicky obviously doesn't want to lose her commission - and I don't blame her. My main concern is to find out exactly who the developer is and what kind of vehicle (company) he is using for the project. Even though Nicky said that Property Showrooms had carried out some due diligence there seemed to be some confusion over exactly what company I would be contracting with. She emailed me the CV of the developer, Jose Edirardo Silveira Santos. He is apparently a local civil engineer with 40 years experience under his belt who has built 3,500 residential homes over the years.

Originally she read out some of her due diligence info (I think it was info from the land registry) and gave me the company name of Corretores Imobiliarios Associados LTDA. This is a real estate company which has been trading since 1980. There is no adverse information registered against it. There are no accounts to inspect as Brazilian companies are not required to make public this type of information. There are two associated companies and two directors neither of which is Mr Santos. After I questioned whether this was the correct company she then gave me the name Homes in Brazil LTDA and confirmed that it is normal in Brazil to set up a separate company for each development. I am not bothering to credit check this company because there won't be much information available if it is newly incorporated.

Nicky said that there would be a building guarantee of between 5 - 10 years (I am guessing this is like the NHBC guarantee on new builds in the UK). She confirmed that the development, once completed, would be run condominium style so the villa owners get to choose the management company (and more importantly get to fire them if they don't provide a good, value for money service). Nicky, or the developer's representative, answered this specific question as follows by email:

What happens, under Brazilian law, if the building company goes into
liquidation before completing the development? Are purchasers who have paid
a deposit simply unsecured creditors? Or does the initial paperwork (on
paying the 30%) give the purchaser some kind of legal charge over their plot
of land?YES THE PLOT WILL BE WILL HAVE LEGAL CHARGE

I cannot fault the customer service provided by Property Showrooms, however, if they have conducted some due digilence it might be helpful to voluntarily share it with potential investors in order to offer them some reassurance. I appreciate that as middle-men they don't want people trying to do deals direct with the developer but I think more concrete facts would help potential investors to make what, after all is one of the biggest buying decisions in their life, which should equal more sales which should, in turn, equal more commission.

The Development - Banana Residencial Club

The Banana Residencial Club is scheduled to be a development of 100 three bedroom villas right next to a lagoon. The villas are on freehold plots and cost 75,000 euro not including furniture or air con. This seems to me like a very reasonable price, however, this probably has something to do with the fact that the site is a couple of miles from the beach. The gated development will apparently have two communal swimming pools, 24 hour security, tennis courts, helicopter pad, clubhouse, coffee shop, minimarket, gym, private pier access into the lagoon, property management and lettings service, large communal gardens, private fishing lake, kids play areas and a sauna (as if it's not hot enough just a few degrees from the equator!).





These artist's impressions of the villa were taken from the Property Showrooms e-brochure. [Property Showrooms - please email me if you would like me to remove these images. I do not want to infringe on your copyright].

A 1,000 euro reservation deposit is required to reserve your chosen plot. Thirty days later a 30% deposit is required minus the original 1,000 euro reservation deposit. There are four phases of construction but you are required to start making monthly instalments for twelve months before your phase is due to be completed. The final 50% is due on completion. Obviously phases three and four are the safest bet because phases one and two should be well under way before your instalments start. There is a fairly large lot (588 square metres) in phase three so if I go for that my payment schedule would look something like:

June 07 - 1,000 euro

July 07 - 21,500 euro

Jan 08 until Dec 08 - 1,250 euro per month for 12 months

Jan 09 - 37,500 euro

Total payable = 75,000 euro

The price includes kitchen & bathroom fittings and built-in wardrobes. An optional furniture pack, including air con, is available for 10,000 euro (a very round sum!) and a private pool is available for 10,000 euro (another very round sum!).

The Big Question

My next dilema is where to invest. The Natal and Fortaleza areas appeal to me most simply because I will get more for my money as they are not as developed as Salvador and the Coconut Route. I also think that tourist rentals (when they materialise) will come from Brazilians travelling within their own country rather than foriegn tourists so I am not too bothered about how many international flights the local airports handle. The next question is whether to invest in land or property. If it's property then should I invest in a house on its own or on a development? If on a development should the development have been completed or should I buy off-plan?

I rule out a property on its own as locals pointed out to me that empty properties attract squatters and vandals. So I am left to consider whether I go for land or a property on a development. A re-sale on a development would be safer than off-plan, however, off-plan seem to be cheaper.

I spend a great deal of time at my laptop looking at e-brochures for villas and apartments in the Natal and Fortaleza areas. Each development has its pro's and con's. After a great deal of deliberation I settle on the Banana Residencial Club * near the town of Cumbuco which is about fifteen miles from Fortaleza airport.

* I have linked to a Brazilian site because the agent that I am using does not allow deep linking as they require users to register before viewing properties.

Risk -v- Reward

After my visit I have a lot of thinking to do. I think that there could be substantial rewards in the form of capital appreciation over a ten year period in NE Brazil, however I am not convinced about rental income in the foreseeable future. Since I am investing for the long term I am not too concerned about this.

I am no economist or political expert but the signs for Brazil look promising:

1) In 1995 the interest rate hit a massive 85%. It dropped between 1995 and 2000 and since 2000 it has fluctuated but it has not risen above 27%. It is currently 12%.

2) Inflation is hovering between 3 - 4%.

3) Brazil was one of the BRIC countries tipped for rapid growth by experts in 2003.

4) There is evidence in Brazilian shops of a fledgling consumer credit movement. Many large retailers offer staged payments on goods, akin to the old HP agreements in the UK.

5) The Doing Business website reveals that, although not up to OECD standards, it takes less time to register a property than other countries in the region. On the same website, however, the typical time to build a warehouse looks pretty horrendous - 466 days compared with 199 days in other countries in the region.

6) The president, himself from a poor background, seems keen to improve the lives of people living below the poverty line. If he succeeds in narrowing the gap between rich and poor, more Barzilians will have the wherewithal to travel around their own country as 'tourists'.

7) The NE of Brazil has most of the ingredients required by tourists, such as sunshine, golden sandy beaches, swaying coconut palms, a low cost of living (at least for now), warm lagoons, friendly locals, a wide variety of accommodation, an infrastructure of sorts, carnivals and culture.

On the other side of the coin the potential risk pushes me right out of my comfort zone. Property development in the UK is judged by credit assessors to be one of the riskiest businesses there is. A multitude of things can go wrong on a development, many of which are outside the developer's control. The cash flow on a development is usually very finely balanced and there are many things that can tip a developer into insolvency. So if property development is seen as risky in the UK then it is doubly risky for inexperienced foreigners (like me) investing in projects in Brazil.

I suppose my worries fall into two camps:

1) The developer is basically honest but gets into financial difficulty. This happens to the best of developers in the UK but that is not much consolation when it is my money on the line.

2) The developer is dishonest and disappears with the hefty deposits (typically 30%). This is not as far-fetched as it may sound. Take the example of the Irishman who defrauded British investors hoping to make a killing in Turkey or the UK entrepreneur who scammed people queuing up to buy in Dubai and Spain or how about the Brazilian real estate companies that were a front for Norwegian money launderers? Wherever there are amateur foreign investors with money burning a hole in their pocket you can bet the scammers and fraudsters won't be far behind - remember the timeshare industry in Spain and Portugal in the eighties?

So there it is. Risk -v- Reward. There is rarely ever a good return to be made without some form of risk so I have decided to invest with the following provisos.

1) I will do my best to carry out as much research as I can.

2) I will only gamble what I am prepared to lose.

3) I will not borrow in order to finance this gamble, even though it will tie up a fair amount of capital and will restrict the type and size of property that I can invest in.

4) I will try to make contact with other people who have invested on the basis that together we will be stronger and better informed. This is where you come in, my fellow investors!

The Coconut Route

I had to come back to Salvador for my return flight so I took the opportunity to explore the coastal road which stretches North of the city. This is known as the Linha Verde (green line) or the Coconut Route. There are two highly developed tourist resorts, one is Praia Do Forte and the other is a the upmarket, purpose built Costa Do Sauipe which comprises of several chain hotels.

Both resorts are a prime example of what tourism could be like in the very near future in the Fortaleza and Natal areas. Property prices are obviously higher because these resorts are developed as opposed to developing.

Fortaleza & South of Fortaleza

My total experience of Fortaleza city centre was driving around for a couple of hours when I got lost so I probably didn't do it justice. It didn't seem to be a particularly attractive city but then I am not really a city person. Apparently the nightlife is very good, but I didn't sample it myself.

I spent a short time exploring some of the beach resorts South of Fortaleza, some of which have a slightly dilapidated air about them I think because there are bits of graffiti here and there and lots of neglected buildings. Every other house has a 'se vende' sign on it as does every spare patch of land. There is no doubt that these somewhat down at heel resorts have the potential to become fully blown tourist destinations. As with the rest of the NE coast of Brazil they have the sunshine, the golden beaches and the wonderfully friendly local people.

Maracajau - Porto Dos Corais

The Porto Dos Corais development site in Maracajau as at April 2007.

Although the aim of this trip was to get a general 'feel' for North East Brazil I made a conscious effort to have a look at a development that is being heavily advertised on the web. The development, Porto Dos Corais, is being marketed by several agents to UK investors. I understand that the development mainly consists of one, two and three bedroom apartments. I met a representative of the developer, Hans Leistedt, at the site. There was very little to see as work hadn't really started, the area had just been fenced and cleared. There was some basic accommodation for building labourers but no actual work going on when I visited. There is no doubt that the development is in a beautiful spot with a lovely beach just metres away and fantastic sea views. The site is far enough out of Maracajau to be peaceful but near enough for convenience.

Hans was very helpful and informative and answered all of my questions in detail. I discovered that the developer is using a Brazilian limited liability company called Brazil Homes Empreendimentos Imobiliários LTDA and is registered in Brazil with the tax payer number (CNPJ) 07.447.622/0001-01. The construction company is called Consol Construções LTDA. In the UK it is normal practice to use a limited liability company to undertake a development as the owners of the company (the shareholders) and the people that run it (the directors) can walk away if anything goes wrong. It is also normal practice to form a separate limited company for each individual development so that the risk on each project is ring-fenced. This means that if a project fails the shareholders and directors cannot be made personally liable for the company's debts or legal obligations. Limited companies in the UK are no big deal - anyone can buy a ready formed company over the phone for less than £40. The privilege of limited liability is much abused in the UK, however it could be different in Brazil. I understand that there is some form of bank guarantee on this project, however my experience of guarantees in the UK has taught me to consider the following:

1) How watertight is the wording of the guarantee? In the UK it must be spot on otherwise it will be challenged by clever lawyers. A vaguely worded guarantee or a 'letter of comfort' is unlikley to be enforceable.

2) What exactly is the bank guaranteeing? That the project will be completed within budget and on time? That investors won't end up out of pocket?

3) Is the bank backing the developer or the construction company or both?

4) What specific event or chain of events trigger the honouring of the guarantee? For example , must the company enter into formal insolvency procedings before the guarantee is honoured?

5) Does the guarantor have good standing? I am thinking here about BCCI.

Hans said that the developer had a lot of experience in property development, however, I understood that it is his first business venture alone - he was previously an employee of large construction companies. Hans can be contacted on +55 84 3642 1477. There is information about the progress of the development available at Brazil Homes. Right next door to this site is a very impressive completed development. The houses are of solid construction with a good finish, there is a beautiful swimming pool with 'swim up bar', landscaped grounds, a security guard, a manager - in fact, it had everything except tourists!:


The exterior of the walled development and the 'swim up' bar

I am beginning to think that NE Brazil is a long term investment and the spoils will be capital appreciation rather than rental income. The developer of Porto Dos Corais estimates that the maintenance charges are likely to be in the region of 50 - 100 euros per month. There is also apparently an annual real estate tax of 0.6% plus buildings & contents insurance, utility bills and possibly some form of public liability insurance if the property is to be let. I am conscious that any investment I make in property will cost me at least £1,000 per year to maintain and that I may not have any rental income to offset it for a few years.

Maracajau

The further North you head the less 'touristy' it becomes. About 40 miles north of Natal is the small town of Maracajau which is famous, at least locally, for its reef. The town is set in a kind of a bay with a sweeping golden beach backed by coconut palms (see picture, left). I stayed for 4 nights in Maracajau for two reasons. One, because several agents are pushing the Porto Dos Corais resort very heavily in the UK and I was intrigued to see if it lived up to the blurb. Two, I needed a bit of relaxation and the town is such a laid back place. I stayed at a beach front pousada near the water park called Pousada Ponta Dos Aneis where £27 per night got me the largest chalet plus
breakfast for two. The pousada is run by a charming young couple who don't speak any English but are very good at sign language (as I am). The pousada's tariff is based upon a 'low season' which runs from March to November and aside from me and my partner there were only three other guests, all Brazilian. It seems that tourists are bussed in on a daily basis to snorkel or dive on the reef but come evening time the town is devoid of tourists. There is a sense of anticipation in that you feel the town is waiting patiently for its transformation into a fully fledged 'resort'. Personally, I think that the whole of the Northern coast will take off in a big way, maybe as far up as Touros - the only question in my mind is when?





No tourists on Maracajau beach in April 2007 - just a few wandering cows!

North of Natal

I drove out of Natal (again, stupidly at rush hour) and headed to the 'old bridge' at the top of the estuary not realising that there is a small car raft (balsa) which crosses the Rio Potengi for easy access from the city centre to the North coast. The raft goes backwards and forwards all day and can hold about ten vehicles plus foot passengers. Just downstream of the balsa a huge 'new bridge' is being constructed so that traffic can easily reach the North coast from the city centre. This bridge is not quite finished yet - there is still a gap in the middle where each side should meet! Locals and ex-pats that I spoke to agreed that once the bridge is completed it will really open up the Northern coast, although nobody was sure when it would be completed. The coastline North of Natal consists of wide sandy beaches backed by magnificent dunes dotted with small resorts. 'Se Vende' signs are everywhere along this strip of coast and it seems like every local either acts as an official or unofficial estate agent or knows someone with land or property for sale. The basic infrastructure along the coast is in place, although as mentioned before the roads range from newly laid roads (the BR101) to stony, sandy tracks. The resorts comprise mostly of small privately owned hotels and pousadas - I didn't spot any international chain hotels along this coast. Many of the pousadas and restaurants have no credit card facilities.

Natal

Natal is a sprawling city which I found difficult to navigate due to a lack of signposting and arriving at rush hour! I spent a night at the Novotel (£60 B&B for two) in order to get a feel for the city centre. I walked along the seafront from the hotel that evening but was told not to go past a certain point as it is unsafe for tourists. Franscisco, an English speaking lawyer who spends his evenings working at the tourist information centre near Praia Dos Artistas is extremely helpful. The free maps that are available from the centre have adverts to do your bit to help stamp out the child sex trade, so that is obviously a problem here. I don't know quite what impact this issue might have on the city's reputation, but the same problem hasn't stopped 'ordinary' tourists visiting Thailand or Sri Lanka. There are a large number of hotels and pousadas to be found near the city centre beaches plus dozens and dozens of tall apartment blocks.

Canoa Quebrada

A GOL flight transported me from Salvador to Fortaleza (£25 one way) where I had pre-ordered a car from Hertz. There are a number of car rental agencies at Pinto Martins airport and in hindsight I may have got a better deal without pre-booking. I specifically ordered an estate car which would enable me to store two large suitcases 'out of sight'. Hertz proved to be very efficient and I was soon on my way out of Fortazleza travelling south down the coast to Canoa Quebrada (100 miles). The road surfaces in some areas are very pot-holed and animals are liable to decide to cross at the most inopportune moments. The roadside is littered with carcases of the unfortunate dogs and mules that didn't make it. There is a distinct lack of signposting and Brazilian motorists tend to drive faster than in the UK, so I would describe the driving experience as 'challenging'. Canoa Quebrada is a delightfully laid back town with a definite 'hippy' feel to it. I stayed at the Dolce Vita poussada (£25 B&B per night for two). The rooms were clean and comfortable, the owner was friendly and there was a swimming pool to cool off in. Canoa Quebrada is an established tourist spot so there is a wide choice of pousadas, restaurants and bars. Despite the intense heat there is a strong wind blowing in from the sea which makes powerkiting and surfing popular pass-times. Although there were tourists staying in the town it wasn't very busy, but according to locals, March to May is the 'quiet' season although they claim it livens up at the weekend.

Salvador

Luis Eduardo Magalhaes International Airport in Salvador is reputed to be the sixth busiest passenger airport in Brazil. On arrival at the airport passport control was chaotic to say the least. I queued for about an hour and a half before I got through - just what you need after a long flight. Whether this had anything to do with the Air Traffic Controller's strike from the previous week, I don't know. It might just have been a one-off, but if the Brazilian government want to encourage foreign tourists they will have to take a close look at the efficiency of their airport arrival procedures. I stayed at the Sofitel near Itapua (£65 for a double room with breakfast for two) simply because it was the closest 4 star hotel to the airport. It was about a fifteen minute ride from the airport by taxi. The hotel was up to the usual Sofitel standard with lovely peaceful gardens overlooking a small lagoon. I breakfasted outside with the wildlife for company - very relaxing. The hotel serves as a convenient base for the airport but it is quite a distance from the heart of the city. I only had a couple of days in Salvador so I made use of the cheap and plentiful taxis and didn't bother renting a car. I managed to do a couple of very comprehensive private tours in order to get a feel for the city and its environs. I prebooked the tours with Tours Bahia. Each full day tour cost about £120 for two of us for a full day with lunch, English speaking guide and driver. Real estate prices in Salvador weren't bargain basement, probably because the city is already established as a tourist destination. I quickly realised that, although there is a lot of property 'se vende' (for sale) it would be difficult for a foreigner to manage a single property remotely. My Brazilian tour guides pointed out the fact that empty properties tend to attract squatters and sometimes vandals.

Field Research - General Observations

My experience of Brazil was limited to a three week holiday in Rio and Iguazu two years ago, so I set off for North East Brazil on 6th April 2007 (Easter). My time was limited to two weeks so the aim of my trip was to get a general 'feel' for the North East as opposed to viewing specific developments or sites. I flew from Manchester to Salvador with Airtours / Mytravel - thank goodness for the extra legroom option at £35 each way. The ordinary economy seats looked really cramped for a 9 hour flight. The cost of the flight (including the leg room) was £615. I didn't pre-pay for a meal but got one anyway. Note that Airtours flights from Manchester actually call at Gatwick which adds a couple of hours to the journey. If you live in the Midlands you might as well just get on at Gatwick. Thomas Cook also do flights and holidays to Salvador as do Kuoni. Thomson fly to Natal between November and April. I managed to do a whistle-stop tour of: * Salvador and the Coconut Route * Natal and the North coast to Maracajau * Fortaleza and it's Southern environs * Brief stop at Canoa Quebrada.

Internal flights are cheap, for example, it cost about £50 return from Salvador to Fortaleza with GOL. This airline require a CPF tax number to book online so you will need to book through a Brazilian travel agent if you don't have one. If you are travelling to Salvador I can recommend Mariana Ferrari at Tours Bahia. She speaks excellent English and was extremely helpful. Myself and my partner rented a car in each location without any difficulty and for fairly reasonable rates of £25 - £40 per day with unlimited kms and insurance. Driving in the cities can be a bit hairy and some of the rural roads are poorly surfaced (even the major roads). I came across a few 'new' roads which had given way:









There are some unusual road hazards such as wandering mules, dogs, chickens, cows and snakes to watch out for. My navigational skills were tested to their limit as signposts are few and far between. I would imagine that it wouldn't cost much to rent a car complete with driver if you prefer a less stressful trip.

Accommodation of all types is plentiful. I stayed at a five star hotel (£85 per night for two with breakfast) to simple pousadas (average £25 per night for 2 with breakfast). I didn't need to book any accommodation in advance. In fact, with the exception of Salvador and the Coconut Route, most of what are being advertised as tourist resorts were actually devoid of tourists during the time I was there.

Tourism in the Salvador area seems more developed than in Natal or Fortaleza. Although there were down-market and up-market areas in all three cities it seemed as though Salvador is pitching more to the luxury market whereas Natal and Fortaleza are aiming for less well-heeled visitors. Perhaps this is because they are at different stages of development?

You can pay five star prices for food, drink and entertainment but generally costs are lower than we are used to in the UK. Note that outside of the cities it can be difficult to change cash and many small pousadas and restaurants do not accept credit cards. My English pin number failed to go through on a few occasions. Keep a good supply of reais with you, but spread them around different people / pockets and bags.

The weather was extremely hot, particularly in Fortaleza which is close to the equator, but there was nearly always a cooling breeze to be felt. Air conditioned buildings are a necessity and not a luxury for quality tourist rentals.

The general consensus is that most of the crime is limited to certain areas of the cities. I was given very explicit instructions regarding which areas were safe and which were not in all three cities. I stayed away from the 'iffy' areas and I didn't have any problems, in fact quite the opposite. I found the locals to be extremely friendly and helpful - even to the point of driving my rental car for eight miles when I was struggling to get out of Natal at rush hour. If visiting I would check out where you can and cannot go in the cities and dress down (most Brazilians dress very casually anyway). I would avoid wearing jewellery altogether.

English is not widely spoken outside of the cities but I managed to recognise some Portuguese words which were similar to Spanish words. I would recommend taking a good phrasebook with you unless you are fluent in Portuguese.

Preliminary Research at Home

I first considered investing abroad about two years ago. I started surfing the net for info and got interested in the Ukraine. I thought that Ukraine would be likley to join the EU within the next ten years and that property prices would probably increase dramatically as a result. I travelled from Kiev down to the Crimean peninsula over a period of a week and came to the conclusion that an investment there would be fraught with problems. I couldn't make head nor tail of the Russian script on a restaurant menu let alone try and buy a property in a country with a reputation for corruption and organised crime. It was then that Brazil somehow appeared on my radar, possibly because I had previously enjoyed a trip to Rio and Iguazu.

I started subscribing to email alerts from real estate agents who were pushing Brazilian property. I attended an exhibition in Birmingham where the 'quality' of the agents varied widely from very knowledgable people to complete dumbos (why do they spend money on an exhibition stand and then staff it with 'salespeople' who don't know the fist thing about the properties for sale or the locations?). I also began lurking in forums to see how other people were faring with their new Brazilian property purchases.

Finally, I felt ready to embark upon a field visit ...

First Things First

First things first. I am purchasing real estate abroad for the first time and thought it might be a good idea to document my progress. I am female in my late thirties and live in the UK. I own 50% of a small portfolio of residential and commercial properties in England and Wales which has been built up very slowly over a thirteen year period. Part of my 'day job' involves investigating dodgy dealings and potential frauds in the UK construction industry, consequently I am wary about getting involved in property speculation abroad - I view it as a gamble so I am only going to spend what I am prepared to lose. I would class myself as 'risk averse' but I suppose risk is in the eye of the beholder. That said, there is a definite 'buy abroad' bandwagon and I have decided to throw caution to the wind and jump on it. Brazil is my country of choice for investment ... watch this space if you would like to accompany me on this journey into the unknown!