With the World Cup just days away, football fever has gripped sports fans across the globe - and at least one developer is cashing in.
London-based Ritz Property is trying to woo buyers in Singapore with its 168-unit project, Costa Azul Residences, a 15-minute walk from the beach in Brazil's coastal city of Natal, one of the World Cup venues.
Only two-bedders at the freehold condominium have been offered, starting at $200,000 for a 575 sq ft unit.
Since the project's launch last month, half of the 108 two-bedders have been sold, with about 20 of them going to Singapore buyers.
To sweeten the deal, the developer is giving away a limited number of tickets to early buyers to watch two World Cup matches in Brazil, complete with airfare and accommodation for two.
Mr Andrew Thompson, group sales director at Ritz Property, said demand for the project may be lifted by the two big upcoming sporting events.
"With the World Cup in 2014 and the Olympic Games in 2016... Brazil will benefit from the multi- billion pound revenue streams that such events typically create," he said.
However, those expecting to check out their new purchase during their trip will have to wait.
While the developer will take buyers to see the site in Natal's upmarket Petropolis district, the condo's three towers - which will be 18 to 30 storeys high - are still under construction. The project is expected to be completed only in 2016.
Singaporean Ivy Chong, a 31-year-old sales professional, said she bought a unit for investment purposes and was drawn to the area's leasing potential.
"There's potential from the events coming up... and the estimated capital appreciation is also okay with me," she added.
Ritz Property expects capital appreciation of between 15 per cent to 20 per cent a year, and is also offering a 7 per cent rental returns guarantee for the two years after the project is built.
But Mr Getty Goh, director at real estate research group Ascendant Assets, urged caution when buying foreign property in less familiar markets.
"Buyers here should be mindful that the property is in a completely different jurisdiction... A practical concern is maintenance, especially if you're renting out," he warned.
"Unlike a property in Kuala Lumpur, which you could still check on regularly at little cost, it may not be as convenient to do the same for your Brazilian property."
Singaporean buyers should also note that foreigners are not allowed to obtain loans to fund property purchases in Brazil, which means the amount of cash that has to be paid up front will be higher.
Ritz Property has tried to get around this problem by offering payment options, such as allowing buyers to put down as little as 30 per cent of the property's price - or about $60,000 - as a deposit, with the rest to be paid by instalments spread over three years.
Mr Teo Wee Hwee, real estate tax partner at PwC, warned that laws on taxability, contracts and ownership vary from country to country.
"Before making any overseas investments... it is always best to familiarise oneself with the local laws and legal procedures before finalising the transaction. It is also important to be aware of the tax costs involved," he said.
This article was first published on June 8, 2014.
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