[BUYING AND SELLING REAL ESTATE IN BRAZIL]
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owners are required to manage their property in a manner that benefits not only themselves but also the community at large, contributing to social cohesion and equitable development. The property not used in accordance with its social purpose is subject to expropriation procedure by relevant authorities. In Brazil, the ownership of a real estate property is formalized by the land title, which must be duly registered with the Real Estate Registry Office responsible for its specific territorial jurisdiction. Consequently, if the transfer of title is not registered as required, the acquirer cannot be declared its legal owner and is considered merely a possessor. Properties can be primarily classified depending on their location or intended use. There are two main types of property:
environmental regulations, registration, taxation, and restrictions on acquisition or leasing by foreigners. 3. TYPES OF REAL ESTATE DEVELOPMENTS Brazil law basically recognizes the following types of land development: a) Urban properties: a.1) Allotment - the division of a plot of land into lots with the installation of the necessary infra-structure, i.e. serviced lots (e.g. streets, water, sewage, electricity for transfer to public agencies upon conclusion) prepared and ready for sale, ruled by Law no. 6,766/79.; a.2) Land division - the division of a plot of land into lots without the installation of infrastructure (because the plot already has access to the necessary infrastructure); a.3) Real Estate Development - real estate developments are regulated by Law 4,591/64, which stipulated the division of a parcel of a property into several individual and private units. The division establishes a register for each unit. Additionally, for the development and sale of hotel units including hotel and lease management, it is also necessary to comply with the Securities Commission’s Normative Ruling nº 602/18; a.4) Plots under the condominium regime - regulated by Federal Law no 13,465/17, this type of condominium entails division of plots into lots, without
a) Rural property. b) Urban property.
The classification of a property as urban depends on its inclusion within the urban perimeter established by municipal planning regulations. A property located outside the urban perimeter, or one that, despite being within the urban perimeter, is used for rural activities, will be classified as rural. Urban properties can be classified as residential, commercial, and industrial. The ownership of urban property may be classified as fractional ownership, joint ownership in a condominium building or a co-ownership in an ordinary condominium. The importance of identifying a property as rural or urban lies in the fact that each classification is subject to distinct legal frameworks, particularly concerning aspects such as land use, land tenure,
improvements, created/developed as individual units with the
ILN Real Estate Group – Buying and Selling Real Estate Series
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