The problem with the exchange rate is that it hasn't kept up with inflation here because the dollar deflated as teh peso was deflating. Some things have risen at least 100% in the last couple of years, some things less. The exchange rate, when I moved here late in 2006, was just about pegged at 3 to 1 to the dollar. It fluctuated a few cents up and down, but was pretty close to that all the time.
In 2007 I lived in temporary apartments, anywhere from one month to three months at a time. I actually moved 9 times that year. The most I ever paid for a temporary apartment was $850 dollars a month for a two bedroom, 65 square meter apartment near Callao and Corrientes. I thought that was really high at the time, for a temporary apartment.
The apartment that I moved into at the beginning of 2008 was a two bedroom apartment in Recoleta, on Juncal between Riobamba and Junin. It was a two year lease, but I sublet from an acquaintance who had paid the full 2 year lease in advance in lieu of having a garantia. After a year he had to go back to the US and I took over paying his lease - moved in and bought all of his stuff from him.
His rent was $750 dollars a month. The apartment was 100 square meters and had a dependencia which I used for my (rather cramped, admittedly) office.
At the end of the lease in September 2008, the owner told me that he was going to raise the rent to $1200 dollars, because that was what property was going for in that area. I think he was a bit high on the price, but maybe $1000 dollars would have been reasonable given the prices at the time. I think he really wanted to sell the property and scared me off on purpose.
Going from $750 in 2006 to $1000 in 2008 would be a 33% increase. The dollar was still 3-1 at that point. But of course, the owner still wanted the rent paid in dollars, not pesos, which is not common really when talking about rental prices.
If you can find a 2 year lease without a guarantee (not impossible - I have three different friends who have managed to do so, but it takes a lot of work and hussling), you will find that they have inflation built into your contract. Depending on the owner, the location, etc, there is a 15% to 20% increase in rent built into the contact in the second year's price. The agents I talk to about renting have all told me that everyone figures the inflation rate itself has been higher than the 20% maximum on the rent.
I think rent prices have more or less stabilized for now though. I don't know about property prices for buying - I don't intend to lock any sizeable portion of money into Argentina, personally. But rent-wise - my wife and I are looking to return to the city and have been looking at apartments.
We are still finding decent deals on three bedroom apartments, for example. I looked at one yesterday that was 160 square meters with three bedrooms and a dependencia in Nuñez, on the 10th floor of a building right on Libertador across from the navy mechanics' school. The view was breath-taking. Across the other side of Libertador, I could see nothing but trees and a few small buildings all the way to the river, and on a clear day I have little doubt one could actually see Uruguay. In front and a little to the right I could clearly see the River Stadium. It was truly a beautiful view.
$4000 pesos. Just a little over $1000 dollars right now. Not bad at all. Of course, with a built-in 20% increase in the second year...
But inflation-wise, I think food and of course imported products have been the biggest increases. Everyday things. I don't know how much longer the economy can stand this, and something has to give because I know the lower income people out here where I live are all suffering tremendously from rises of 50% to 100% in food stuff that they buy regularly.
If you are coming here and don't see the prices as bad, you are probably going to be okay I think. I just can't see things going much worse unless there is some kind of financial collapse like 2002, which of course would make the dollar stronger in relation to the peso unless the States collapses too.
But right now, if you find prices good, you shouldn't see too much more of a rise I think, at least not to the scale of what we've seen over the last two years.
I'm a software developer, though, not an economist, so I could be completely wrong
