Brazilian Government Intends to Sell Properties

You found it. It’s the perfect condo overlooking Copacabana beach in Rio de Janeiro. And now you’re ready to buy. But then you find out the Brazilian government owns the land. Now what?

It’s not uncommon to find that certain properties in Brazil are owned by the government. This is particularly true of land near ports, military installations, or other areas of national interest. In Rio, many oceanfront properties are subject to government ownership.

This isn’t to say that you can’t still buy the property. It just means that you’ll be stuck paying more. Think of it as paying for the private use of public property. The government is letting you use something it owns.

Payments are made in two ways. First, upon transfer of a property, the seller pays a fee or laudêmio of 5%. Transfers by donation and inheritance, however, are exempt from laudêmo.

Second, there’s a yearly fee that’s paid as well. The occupant either pays a taxa de ocupação when the government owns 100% of the property or foro when the government owns only part of the property. These fees can reach up to 5% of the value of the land.

Recently, the federal government announced a plan to release around 600,000 properties that it owns by the end of 2022. Occupants will have a purchase option to buy out the government, and as a result, they won’t have to continue paying their yearly fees.

It’s worth doing a bit of checking if you have a property subject to yearly use fees. Today might just be your lucky day.