1. Projects for Popular Houses
Mike Smith
Licensed realestate broker in
Natal,Brazil
CRECI;3125
2. Minha casa- Minha vida
• Government scheme to assist lower paid
families and first time buyers to own their
own home, gaining a government subsidy
of up to R$17.000,00 dependent on the
age and profile of the applicant.
• Our projects target this profile perfectly
3. Constructions completed
• Parnamirim- Rua Mar de Galilea, close to
amenities including schools and hospitals.
• Paved street
• 3 bedrooms with one en suite, total of
76.15 m2, with plot sizes 204 -224 m2
• Price R$99.000,00 each
• All sold, marketing direct, and through
estate agents
5. Macaiba/Parnamirim
area of urban expansion growing rapidly
• Current project for 56 apartments, 2 bedroom, 55 m2 in
size, targeting families with income above R$1.400,00
per month, with finance available up to 25 years, through
Caixa or other banks.
• Launching with price of R$82.000, with all transfer costs
paid by developer, so buyer does not need cash.
• First 8 units ( 2 blocks of 4) completed November 2011
• Pro-active agent appointed to market these units with
possibilty of taking reservations and advance monthly
payments.pre-reservations going well and we are under
pressure to complete sooner than planned
13. Location of 56 apartment project
• Located in an area of loteamento fast growing
with construction, on the border of Parnamirim
and Macaiba.
• Google image shows the location, with the plot
of 9000m2 for 60-80 popular houses,
• Local agent Da Hora (Ponta Negra) are starting
to take reservations- they are really pleased with
the quality of build, layout, price and concept
offered, and are pro-active in their marketing.
15. Macaiba 140 house project
• Located in Macaiba, in a very good position, with
bus routes and asphalted main road access, this
project is ready to start with all licences ready
including IDEMA.
• Houses of 2 bedroom, 55 m2, on plots of 200
m2, they are targetting low income families, the
largest market in Brasil.
• Selling price expected to be in the region of
R$80.000.
17. Benefits of these developments
• They are targeting low paid families which is the largest class
• The first project consists of 7 buildings of 8 units and each of the units is
independently supplied with water and energy, and has its own waste
deposit.
• There is no leisure area to create the need for condominium charges.
Since the income levels of the profiled buyer is limited, they may well
afford the mortgage repayments, but not extra for condominium
charges. (typically 100- 250 R$ per month
• Our own research and personal experience is that the leisure areas
provided in the majority of the popular house accommodation, are
under-utilised at best, and therefore not needed.
• The second project consists of 140 houses with 55 m2 of construction,
selling at similar price
• Buyer can reserve without a large deposit and pay monthly payments
until build is finished, and then the rest is financed by the bank.
• Macaiba is growing fast, close to the new airport and close to the
developing ZPE area.(Zona de Proteção de Exportação.)
18. Investment opportunity
• The land and projects have been bought and paid for by na british
investor who has been resident in Brasil for some 5 years, with his
own money and resources.
• Land banked includes 9000m2 with an outline project for 60-80
house units 3 or 4 in a terrace, units similar size to the units in the
apartment project, and also aimed at similar market price. Plans for
this project are in process, and will require finance to assist in the
the construction.
• The 140 house project is one which should be built out as soon as
possible, and could be done in phases of say 25 – 40 houses. This
would require financial assistance, for the build, in the region of R$1
million. Each phase would be around 6-8 months to complete.
19. Reward/Benefit to Investor
• The investor does NOT need to be directly involved with the developments
or sales.
• The investor is secured with his loan being made with asset backing, to
secure the loan. Offered security is the land mentioned earlier, 9000 m2, for
a 60-80 unit development, and for which a project is being done.
• Value of this land now, would be around R$500-600k. However the
landowner can also offer other land assets, and /or constructed product as
collateral.
• Return offered is highly attractive to a passive investor, with NO RISK
attached to the investment.
• Investor does not need to be resident, or take risks in a market he does not
know, yet still achieve returns on capital difficult to imagine, even without
security, but this DOES have security.
• Period for investment can be for 6 months or a year, with a return of 20%
p.a interest.
• How can they pay this level of interest? It is simple – when the land was
bought the unit price of land, per apartment was low- with the finance cost at
25% p.a added the unit cost of land is still below the average for the market
in the area. Sales price will reflect market price for land.
20. Exit strategy guaranteed
• THE INVESTOR CAN CHOOSE either six
months or a year, with a possible roll over
option as well, for a longer period,if happy
with his involvement.
• Sales revenues can repay the investor
earlier if requested.
• High return without RISK!!
21. Other options for investment
• Form a new company with investor as shareholder. This
would require investor to attain residency here to
participate in the work involved.
• Land asset is assigned to the company
• Project developed and construction started, and investor
is protected by the increasing asset value in the
company. Capital can be injected as a loan, with
conditions of interest payments and capital repayment
included in the contract.
• This may be suited for someone who does wish to be
involved in the project, and may be best suited for the
future 60-80 unit development on the 9000 m2 land.
