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Brazil is Capital for Property Investment Appreciation

Property investment in Brazil ranks second in the world for capital appreciation, according to the latest survey released by the Association of Foreign Investors in Real Estate (AFIRE). Close behind the US in first position, Brazil has entered the AFIRE top ten capital appreciation investment destinations for the first time.

AFIRE, founded in 1988, is known as the official voice of the foreign property investment industry in the US. Widely recognised for its annual foreign investment survey, AFIRE has for the first time conducted a mid-year survey among its members. This unusual step was considered necessary because of the huge recent changes in the world economic and financial situation. AFIRE was keen to gauge any changes in property investor sentiments.

The survey has brought to light some interesting findings, particularly when it comes to Brazilian property investment. While the Q4 2008 survey found that China was close on the heels of the US in the capital appreciation rankings, the latest survey revealed that China has fallen sharply in the top ten and its coveted second place has been taken by Brazil.

Given the very short history of foreign investment in Brazil property, it's perhaps not surprising that Brazil has not featured earlier in the AFIRE top ten destinations for capital appreciation. However, investors have been quick to recognise the excellent potential offered by this huge South American country. Brazil boasts several prime areas for property investment including north east Brazil. Here, luxury properties are priced at a fraction of what you would expect to pay in an equivalent resort in Europe.

As yet, no official statistics are published regarding Brazil real estate. However, savvy investors who entered the market early on have already seen excellent capital appreciation and judging by the opinions expressed in the AFIRE survey, this tendency is here to stay for the near future.

Brazil property's capital appreciation prospects are a refreshing change to many countries. As those with overseas property investment portfolios are only too aware, real estate investment overseas has plummeted over the last 18 months.

According to Real Capital Analytics (RAC) quoted by AFIRE, transactions have fallen to one-sixth of their level two years ago and are currently at 73% less than this time last year. RAC also found that no less than 17 countries saw the number of property sales decrease by a massive 80% in the period from Q1 2008 to Q1 2009.

At a time when most developed nations are struggling with recession and financial crises, Brazil is tipped, along with two of the other BRIC nations (China and India), to lead the world out of the current recession. With a stable financial sector, booming stock market and ever-increasing middle class, Brazil is well poised to become a major world power. Small wonder that AFIRE investors rank Brazil second for capital appreciation when it comes to property investment.

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