Inflation over the last few months and years

flippinkittin

Registered
Every few months I see a price jump in the supermarkets, restaurants, and taxis; I don't like it, but it is not new, and I somehow feel it is to be expected. This last time I have felt the jump to be more steep than in the past. This article confirmed my suspicions. What are your thoughts?
 

bairestraveler

Registered
Hi,
I totally agree with you! But you know, there is nothing to do against that, and it's the same thing all around the world...
Anyway Buenos Aires is a very dynamic city in development, so the inflation appears a bit more faster than in the other countries!
So of course it will get worse, Restaurant, bars etc are a bit more expensive than yesterday, but Buenos Aires is still a "cheap" city, where there is a lot of things to discover!
 

Montrose

Registered
bairestraveler said:
Hi,
I totally agree with you! But you know, there is nothing to do against that, and it's the same thing all around the world...
Anyway Buenos Aires is a very dynamic city in development, so the inflation appears a bit more faster than in the other countries!
So of course it will get worse, Restaurant, bars etc are a bit more expensive than yesterday, but Buenos Aires is still a "cheap" city, where there is a lot of things to discover!
I do not agree with this- the price jumps have been much more frequent than what you have in a "first world" city, where prices raise gradually (but steadily) and employers are expected to raise salaries to compensate. Here salaries are not raised for years while prices skyrocket. It may be a cheap city for tourists, but unless you have a full time job paying in dollars or euros I wouldn't call it cheap!
 

mini

Registered
bairestraveler said:
Hi,
I totally agree with you! But you know, there is nothing to do against that, and it's the same thing all around the world...
Anyway Buenos Aires is a very dynamic city in development, so the inflation appears a bit more faster than in the other countries!
So of course it will get worse, Restaurant, bars etc are a bit more expensive than yesterday, but Buenos Aires is still a "cheap" city, where there is a lot of things to discover!
Sorry, I disagree with your idea that inflation is the same all around the world or that Buenos Aires is a cheap city. But I'm not in the tourism industry.

But I'll agree with you that Buenos Aires certainly is dynamic & there is a lot to discover.

flippinkittin said:
Every few months I see a price jump in the supermarkets, restaurants, and taxis; I don't like it, but it is not new, and I somehow feel it is to be expected. This last time I have felt the jump to be more steep than in the past. This article confirmed my suspicions. What are your thoughts?
We are certainly starting to feel the pinch! Ouch!
 

fifs2

Registered
Montrose said:
I do not agree with this- the price jumps have been much more frequent than what you have in a "first world" city, where prices raise gradually (but steadily) and employers are expected to raise salaries to compensate. Here salaries are not raised for years while prices skyrocket. It may be a cheap city for tourists, but unless you have a full time job paying in dollars or euros I wouldn't call it cheap!
This isn´t Greece you know - most employees are unionized and have gained salary increases of 20 - 30% every year for the last 6 years...of course that`s only for those working in the black...which of course is barely keeping pace with inflation and at the same time making Argentina even less attractive for investment.
 

Viajero Mike

Registered
Since all of the houses are paid for in cash argentina is truly a very unique market. The basic rules of real estate still need to apply. Here are a couple of them to see if your buying is a wise investment.

Rules.

  • In real estate you make your profit when you buy…not when you sell. So buy carefully!! Incidentally real estate agents make their profit when they sell something!!!! They always want you to buy. Real estate agents are just like black jack dealers in Vegas. The blackjack dealers are always whining about their tips and real estate agents are always crying about their commissions. You can switch them both around and no one will notice. Each can do the others job no problem.
  • How much to pay for something? This applies to run of the mill homes or condos with nothing special…view of the ocean or a nice park. Take the yearly rental value of the property, subtract all expenses…..building fees …taxes…repairs …ect. Then add a zero. So if you have a property that you rent or can rent for $1000 a month and u rent it for 12 months you have $12,000 in rents. Then let’s say you have $1500 in repairs and expenses. That leaves you with $10,500 add a zero and the property is worth $105,000. That is the most you can pay for it. This will give you a 10% cap rate which is what you should expect if you are managing it yourself. If it is an investment property then you take your yearly rent subtract the expenses and then multiply it by 6. with the same scenario as before this you would pay only $63,000 for the property.

Now if you are going to be living in BsAs for say 5 years then you need to do some math. If you plan on staying that long then you may very well want to buy something. So long as you can sell it!!!! If you are going to pay $1500 a month in rent well that is $75000 right there. And everyone knows that you do not get rent back. Even if you sell the property at a loss so long as your expenses come out to less than the $75,000 then it can be a good investment.

Now BsAs property is being held as a long term investment by there owners. These people are not speculators. Since you do not have a lot of speculators, and maybe you do, the prices seem to be too high for the rents. This is probably a result of people under valuing their rent as to avoid out of pocket expenses.

Bottom line……………..Rent……………..!!!!!!!!
 

jp

Registered
fifs2 said:
This isn´t Greece you know - most employees are unionized and have gained salary increases of 20 - 30% every year for the last 6 years...
No they don't. In the lucky event they get a statutory annual pay rise, most will get a raise in line with official inflation figures. That's a 10% hike whilst the cost of living rises by 20-30%. Hence the anger at official inflation estimates.

If you're lucky and have a good employer, and work in a competitive field, you might get 15-20% annually, but anything beyond the official figure is at their discretion.
 

gouchobob

Registered
Viajero Mike said:
Since all of the houses are paid for in cash argentina is truly a very unique market. The basic rules of real estate still need to apply. Here are a couple of them to see if your buying is a wise investment.

Rules.

  • In real estate you make your profit when you buy…not when you sell. So buy carefully!! Incidentally real estate agents make their profit when they sell something!!!! They always want you to buy. Real estate agents are just like black jack dealers in Vegas. The blackjack dealers are always whining about their tips and real estate agents are always crying about their commissions. You can switch them both around and no one will notice. Each can do the others job no problem.
  • How much to pay for something? This applies to run of the mill homes or condos with nothing special…view of the ocean or a nice park. Take the yearly rental value of the property, subtract all expenses…..building fees …taxes…repairs …ect. Then add a zero. So if you have a property that you rent or can rent for $1000 a month and u rent it for 12 months you have $12,000 in rents. Then let’s say you have $1500 in repairs and expenses. That leaves you with $10,500 add a zero and the property is worth $105,000. That is the most you can pay for it. This will give you a 10% cap rate which is what you should expect if you are managing it yourself. If it is an investment property then you take your yearly rent subtract the expenses and then multiply it by 6. with the same scenario as before this you would pay only $63,000 for the property.

Now if you are going to be living in BsAs for say 5 years then you need to do some math. If you plan on staying that long then you may very well want to buy something. So long as you can sell it!!!! If you are going to pay $1500 a month in rent well that is $75000 right there. And everyone knows that you do not get rent back. Even if you sell the property at a loss so long as your expenses come out to less than the $75,000 then it can be a good investment.

Now BsAs property is being held as a long term investment by there owners. These people are not speculators. Since you do not have a lot of speculators, and maybe you do, the prices seem to be too high for the rents. This is probably a result of people under valuing their rent as to avoid out of pocket expenses.

Bottom line……………..Rent……………..!!!!!!!!
Excellent advice.
 
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