How's everyone hanging in there with the cost of living these days?

[LuckyLuke]

My apartment's insane expense bill for this month is 348,677.02 pesos. Those two cents feel like a slap in the face.

True, it is on a very pretty block, but we have no SUM, no pool, no security, and only 1/2 a portero - we share him with the building next door.

When my grandmother in Texas passed away my mom was left with selling her Condo unit. The problem was it was a senior living complex, which included as an association cost, loads of "help staff" voted in by it's geriatric members. The monthly HOA fees had ballooned into thousands of dollars per month. My mother found it impossible to sell without steep discounts to accommodate the HOA fees the buyer would inevitably have to pay.

 

[JeffR]

After living here for over two years, we’ve decided to leave in a few months and return to our home country.

Living off foreign currency income, we’ve had to monitor exchange rates daily to know when to convert to pesos. The constant fluctuations in the exchange rate have left us feeling exhausted. Months of inflation and a weakening dollar have reduced our purchasing power by 30-40%. While I used to enjoy shopping on supermarket discount days, now I rely on them out of necessity.

Although Argentina boasts stunning landscapes, it is no longer a country offering great value for money (except for healthcare services — we plan to do a body check-up and dental work before leaving). It’s not that we’re struggling to live or can’t afford things, but the same items cost half as much in my home country and are of better quality. We simply want to save money and prefer not to spend it in Argentina.

That's one thing that stands out about being in Argentina. You find yourself unwittingly "sucked into" an unhealthy fixation of trying to figure out how many pesos you'll need for the next few days, so that they don't lose too much value. By and large it's not the norm in other countries, but one ends up thinking it is here.

 

[nikad]

December is a month of higher HOA fees historically as they include the annual salary bonus for your encargado / portero. Another reason why they have gone up in the last year is related to utilities with no subsidies. On top of this, encargados union has been given a retroactive salary raise for encargados and a bonus. Ironically, when these salary matters are discussed, landlords do not have any legal representation and it is all agreed upon encargados union and the chamber of building managers ( which in turn are not the ones that collect the money to pay them, but are not the ones actually spending the money ). The value of HOA fees is not only related to building amenities, but also the number of apartments in your building ( ie if it is split among 60 apartments it will always be way more affordable than among 7 apartments ).

 

[nikad]

As for the current dollar value, in my household we have always tried to keep having a foreign income, and a % in pesos ( less than half ). I have seen it all in my country, and a very strong peso is not new. We honestly feel we are being robbed out of our dollars at this point, but at the same time we can't complain much, since we own property, vehicle, can still afford health insurance, etc.

Most of you were not here during the 90s, but it was the same case: dollar was weak, people traveling abroad, industry dead, foreign investment in the form of companies providing services started to show up, there were well paid jobs, but the country could not benefit much from exports of goods. This lasted for several years, all these companies making pesos, lots of imported good available, mortgage loans, credit, etc.

Then one day, companies decided to cash out, as well as banks, etc 1 peso 1 dollar, they wanted their crispy greens... and it all went to s...t. This is the (in)famous carry trade. Based on what I read, the market is not expecting the exchange rate to change much at all at least for a whole year, could be even more. Lifting the cepo in exchange of crispy IMF dollars will not change much, other than normalize bank transfers, deposits, etc.

I am not quite sure how the economy is meant to grow and people will benefit, other than a smaller group of educated ones than may get jobs. But that is not most of Argentina's people. The city of Buenos Aires is a micro world. In the meantime, in my household we remain as frugal as we can, we try not to think much.

USCIS is still trying to find some time to look into our case 10 months after. We will keep property here, as we feel the US might be even more inhospitable than Arg when we retire. Time will tell.

 

[antipodean]

Take away the CEPO and the dollar has to rise.

But why? Argentines can already use their pesos to buy as many dollars as they want via MEP as simply as logging into their online banking app. The MEP (1048) is now roughly the same as the official (1035). Lifting the CEPO won't suddenly create a stampede to buy "cheap" dollars that does not exist today.

Lifting the CEPO would only mean that Argentines can use their pesos to buy dollars at the official rate, without needing to perform the operation using MEP or CCL, while most importantly, also removing the restrictions on how dollars can enter and leave the country. Politically this government is unlikely to devalue the official to avoid generating inflation while financially they cannot afford massive capital flight which is what the CEPO in practice currently prevents.

Expats who have become accustomed to having a discount on life just for their privilege of having foreign money to spend should remember that the last time there was no CEPO (2018/19) the blue was worth slightly less than the official.

As for hopes that costs of living will start to reduce, it is hard to see the CEPO or exchange rate having much to do with it for the foreseeable future... Personally, I do not expect (nor wish) for wages to reduce (Argentina traditionally is positioned amongst the highest in the region which is part of the reason it is inherently a more expensive and developed country) leaving some hope that the removal of protectionist policies and the reduction of the tax burden on the productive and business sector will reduce some costs slightly over the coming years - but until then, for foreigners, the overall cost of living in Argentina will continue to be somewhat comparable to say Chile and/ or Uruguay amongst the most expensive (yet most developed) places to live in Latin America.

 

[nikad]

Forgot to mention that those living in the province of Buenos Aires, not in the city, will see higher increases on their real estate related taxes etc as Gov. Kiciloff aims to keep certain policies from CFK administration, but without the subsidies removed by the current administration. This means more and higher taxes for bonaerenses.

 

[nikad]

For the time being, I think that exchanging a few more dollars and making a CDI deposit in pesos, will at least give you a bit of extra money ( do not think long term, more short to mid term ). October 2025 we have mid term elections, so expect inflation and dollar sit still ( or as still as possible ). My supermarket tickets keep going up, while promos are more scarce and not really generous.

 

[Quilombo]

As for the current dollar value, in my household we have always tried to keep having a foreign income, and a % in pesos ( less than half ). I have seen it all in my country, and a very strong peso is not new. We honestly feel we are being robbed out of our dollars at this point, but at the same time we can't complain much, since we own property, vehicle, can still afford health insurance, etc.

Except for owning a vehicle and property, I feel like this is my husband and I too. My field is dollarized, and his is pesified, and I'm just hoping in the next 2 years to leverage the "stability" of Milei's governance to save for a downpayment and to get a mortgage on a humble apartment in CABA or house/PH in Zona Sur, because I honestly think this time won't be different, the economy will crash again, but at least we can get locked in to a 20 year mortgage, and maybe import a used vehicle tax free as the government is discussing.

Then one day, companies decided to cash out, as well as banks, etc 1 peso 1 dollar, they wanted their crispy greens... and it all went to s...t. This is the (in)famous carry trade. Based on what I read, the market is not expecting the exchange rate to change much at all at least for a whole year, could be even more. Lifting the cepo in exchange of crispy IMF dollars will not change much, other than normalize bank transfers, deposits, etc.

I was a kid during the 90s, but I feel like we're beginning to live through Menem's 3rd term.

The music of the carry trade/flattened dollar will stop at some point, but the question is who is going to be left without a chair? Right now my money is, as always, on the poor and working class, while this will be a new era of wealth and stability for the rich, even if there is another 2001esque brutal adjustment, because they'll just buy up everyone's cars and houses for pennies on the dollar when things come crashing down.

All this being said, maybe I'll be proved wrong and we'll become something like Chile, a high income, post-manufacturing, services based domestic economy which exports natural resources, and imports finished goods, but I doubt it. As you've said, this sort of economic policy destroys local manufacturing, so I guess I'm pessimistic. I just want Argentina to succeed.

 

[QuilmesSlo]

Except for owning a vehicle and property, I feel like this is my husband and I too. My field is dollarized, and his is pesified, and I'm just hoping in the next 2 years to leverage the "stability" of Milei's governance to save for a downpayment and to get a mortgage on a humble apartment in CABA or house/PH in Zona Sur, because I honestly think this time won't be different, the economy will crash again, but at least we can get locked in to a 20 year mortgage, and maybe import a used vehicle tax free as the government is discussing.



I was a kid during the 90s, but I feel like we're beginning to live through Menem's 3rd term.

The music of the carry trade/flattened dollar will stop at some point, but the question is who is going to be left without a chair? Right now my money is, as always, on the poor and working class, while this will be a new era of wealth and stability for the rich, even if there is another 2001esque brutal adjustment, because they'll just buy up everyone's cars and houses for pennies on the dollar when things come crashing down.

All this being said, maybe I'll be proved wrong and we'll become something like Chile, a high income, post-manufacturing, services based domestic economy which exports natural resources, and imports finished goods, but I doubt it. As you've said, this sort of economic policy destroys local manufacturing, so I guess I'm pessimistic. I just want Argentina to succeed.

The only hope is the wheels stay on long enough to ramp exports (ag, hydrocarbons, minerals). I wouldn’t count on it but I have to hope for it.

 

[LuckyLuke]

....while financially they cannot afford massive capital flight which is what the CEPO in practice currently prevents.

There's the rub...the government, overconfident in its peso value, will fail to shore up its foreign reserves enough to maintain the 1,000:1 convertibility sufficiently to weather a sudden high volume conversion to dollars. The CEPO will snap shut again, which will generate only more panic. The blue value overnight will spike again. You can see below why Milei might not be too eager to lift the CEPO yet...