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Every day, we receive several questions in our real estate agency about the possibility of exchanging a property in Brazil for another in Miami. This specific type of real estate transaction has gained prominence, especially among buyers who want to reduce their investment exposures in Brazil and dolarize part of their assets. Although this modality is becoming more popular, it has additional complexities when it involves goods in different countries, due to variations in real estate processes and legislation. The exchange, although feasible, can also bring disadvantages to the investor. In this article, we will explain in detail the pros and cons of this operation.
What is the exchange of real estate?
The exchange of real estate is a real estate transaction in which two parties exchange properties with each other. Unlike the traditional purchase and sale, where a property is acquired by cash payment, in exchange, each party offers its property in exchange for the property of the other party. This type of negotiation may involve the exchange of residential, commercial, land or even real estate of different types and values.
There are two types of exchange: 1 – Simple or 2 – With turnover
In simple exchange, the exchange is made between goods of the same value. In the exchange with turnover, the goods have different values, which implies that one of the parties delivers the property plus a balance of the difference in money (turnover).
Is it possible to exchange a property in LATAM for another in Miami?
It’s even possible, but it’s not customary in the Florida real estate market.
In addition, it is not easy to find someone who wants to get rid of a property in a solid economy, such as the American one, to invest LATAM with all the political and economic risks that Latin countries offer.
Another major disadvantage is that the buyer will not be able to benefit from U.S. low-interest credit. Florida banks do not only finance the balance in the case of exchange with returns. Learn all about real estate financing in Florida
A complicating factor of the real estate exchange process of Brazil, for example, with Miami is that the purchase process in Florida, although similar to the Brazilian process, is coated with layers of security that makes it more difficult to adapt it to the exchange.
Understand how the process of buying a property in Florida works
The process of buying a property in Florida is relatively simple and very similar to buying in Brazil or other LATAM countries. A deed is passed to the name of the new owner. Access now our Practical Guide (Step-by-Step) on how to buy a property in the United States.
The great advantage of the purchase process in Florida is that the resources for buying the property are not sent directly to the seller. They remain in a trust account, that is, a guarantee account, called an Escrow Account.
The Escrow Account is owned by the registry office, which in Florida is called “Title Company”.
Title Company plays a very important role in the real estate transaction, bringing security and transparency to the process. The values of ownership of the Title Company, which are retained in the Escrow Account, are only transferred to the seller of the property after the complete analysis of all documents and issuance of insurance.
About AMG International Realty
AMG International Realty is a global real estate company specialized in Florida and aimed at the foreign public. Our work goes far beyond the simple intermediation of a property. We want to be your right arm in the USA and, for this, we have a wide network of partners. If you want to know more about the investment opportunities in the real estate sector of Orlando and South Florida, contact me on WhatsApp: +1 305-761-2655 (Heloisa Arazi).
