Brazil`s cheap property is one of the South American power`s less obvious attractions

The rapid devaluation of Brazilian and Argentine currencies since the 1990s has lured Europeans to act quickly on the renewed attractiveness of real estate in South America`s largest economies.
"Argentina: Europe at a third of the price," says one investment-promoting internet blurb. Another market observer puts the prices as low as one-tenth of European prices.

While price is the key factor, cultural affinity also plays an important role, with the Portuguese drawn to Brazil and Spaniards and Italians to Buenos Aires, many to consolidate family ties.

In Argentina, where global tycoons have been buying up land in Patagonia since the 1990s, middle-income investment is concentrating in the more up-market areas of its capital.

"(Investors) consider that Buenos Aires is a very similar city to any European capital, but with much lower real estate values," Guillermo Rivanera, vice president of Tizado Propiedades, told the dpa news agency.

Preferred investment is in the pre-construction sale of large developments, and he said foreign interest has not yet had a significant impact on prices paid by locals in the city of more than 12 million.

Brazil and Argentina share several qualities: With high interest rates and a history of economic uncertainties, mortgages are relatively rare, and real estate is usually paid for in cash.

Brazil`s real, valued 1-to-1 with the dollar in the mid-1990s, has fallen by more than half to 2.1 to the dollar. Argentina`s peso, after being allowed to float in early 2002, dropped from 1-to-1 with the dollar to more than 3-to-1.

South America now a retirement destination

These ladies could be sunning themselves in Rio
Meanwhile, the appreciating euro now punches more purchasing power in Latin America, but not enough to keep up with the soaring property values in traditional second-home or retirement destinations in southern Europe. Overcrowding in Spain, Portugal and Greece have eroded those countries` charm, making distant South America even more attractive.

"The scenery and beaches in Brazil are quite simply breathtaking, the cost of living (can range to) 20 percent lower than the average UK or European equivalents, property prices are incredibly cheap and the country is highly accessible," international property consultant AmberLand tells prospective buyers on its Web site.

Brazil places no restrictions on the purchase of real estate by foreigners, who are only required to have an identification number for fiscal purposes.