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Brazilian Property Set to Boom 20% in the Next Year

Posted August 11, 2008

"Opening up of new air routes is one of the strongest drivers of real estate prices in emerging markets. In Europe this trend is dubbed ‘The Ryanair effect.’" — Ronan McMahon

Blogger’s note: Why would you buy real estate somewhere difficult to reach? Ronan McMahon of International Living knows that no one, except the "ever-profitable" hermits among us, wants to own property in a place they can’t travel to easily. In fact, it’s a well-known (or at least well-known by realtors and professional developers) fact that as soon as an area gets easy transportation, it’s property prices go higher.

And now Ronan has some great news. It just got ten times easier to reach Fortaleza in Brazil. He’s predicting real estate in the area will grow at least 20% within the next year. Learn why below.

by Ronan McMahon

Baltimore — (TFN):  As I’ve mentioned before, the state of Ceara (Brazil)—especially its capital, Fortaleza—is booming. But there was an obstacle preventing U.S. visitors from taking part in this action: a lack of direct flights from the U.S. to Fortaleza.

Fortunately, that’s all in the process of changing…

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Since Bismarck Maia became Ceara’s secretary of tourism in March 2007, one of his first initiatives was to entice Delta to open a direct route from Atlanta to Fortaleza (flight time will be about six-and-a-half hours). Maia realizes that to attract more visitors and investors from the U.S., direct flights are vital.

On June 26, the U.S. and Brazil reached agreement on the liberalization of air routes between the two countries. This agreement will reduce restrictions on U.S.-Brazil flight services and will provide for an increase of 50% in the number of flights. As a result of this agreement any number of U.S. or Brazilian airlines may now serve the market.

Under the new accord, U.S. and Brazilian carriers for the first time will be able to provide some services on a code-share basis with their third-country partner airlines. Most importantly this agreement allows U.S. carriers to serve five new cities in Brazil, including Fortaleza. Read on to learn how direct flights could raise real estate prices 20%.

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    This is good news for people in the US looking to visit the northeast of Brazil and The Brazilian economy in general. As I am sure this new improved access with encourage more people from the US to holiday, visit, holiday, and purchase real estate and property in Brazil.

    It is also worth mentioning that a massive new airport is being built in the northeast near Natal.

    The Tourism Development Programme in the North East, PROSETUR / NE

    Over 670 million dollars have been invested through this programme in infrastructure; transport, the environment, and tourism management bodies.

    The success of this has resulted in the implementation of PRODETUR / NE II with an estimated investment of 400 million dollars.

    Part of this development is the massive airport that is being built in the city of São Gonçalo, about 30 km from Natal, when it is built it will be the second largest airport in Brazil and the 5th largest in the world and being both a cargo and passenger airport it will most certainly have a very positive impact on the growth of trade industries and especially Tourism.

    This massive public investment and urban development activity has led to a major influx of private investment, most notably residential tourist property developments with many top quality tourist resorts offering a range Brazil property including many different apartments and villas in superb locations.

    Its is these new resorts that are taking advantage of the property market boom, many shrewd investors including international celebrities have already purchased and some of the property values have increased by 100% in less than 36 months.
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