Is real estate price converted to pesos at purchase?

[cortes]

Hey guys

Today I was looking at properties throughout Argentina and noticed it was mostly priced in dollars. Is the price in dollars converted to pesos at the time of purchase? As in, a piece of land listed at $50,000 is sold for 4,000,000 pesos at the official exchange rate? If that's the case, then I could transfer my savings through western union and buy it for less than $25000 ($25000 thru WU buys 4,000,000 pesos give or take, rather than 2,000,000). Or do you have to transfer that exact amount in dollars through a bank? I would imagine that they list it in dollars so they don't have to constantly adjust the prices, and once a buyer closes on it, they transfer that amount in pesos

I traveled through south america by motorcycle and spent some time in Mendoza, Rosario, and Gualeguaychu. I loved Argentina, and I was humoring the idea of moving some where in the country once the borders open. My prayers go out to all of the Argentinians suffering from these circumstances. But I'm not gonna lie, possibly being able to buy some land AND build a nice house on it with my savings at the age of 21 is just too appealing.

Any input about how large purchases like property and vehicles go down would be appreciated.

 

[FallenAngel]

Oftentimes the sellers want real USD and not pesos. It would be impossible to find a seller that would accept the equivalent number of pesos at the official rate.

 

[garryl]

peso has a bad name now

 

[Bajo_cero2]

I think that there must be a lot of happy sellers ready to get a transfer ourside Argentina. However, it is not time to but yet. Prices are going to remain in usd, but they must fall a lot.

 

[Alpinista]

1) the real estate market is referenced against the USD since the mid 70's
2) rent is normally in pesos
3) as it is, most real estate objects have a return on the usd value of around 1-2%. Which obviously is far too low. As Bajo_cero2 said, the prices will most likely fall a lot
4) You won't find a seller who accepts the official rate (even if the seller were a government minister who is telling you during the week that the official rate is the "real" rate)
5) Depending on the seller, you can negotiate a (further) discount if you offer to transfer to an account abroad
6) if you are more kind of "fun" buyer, there are certainly better ways to get rid of your money. You also have to think ahead when you will want to sell it again. So it is certainly not advisable to buy real estate here unless you (plan to) have a long term future here in Argentina (e.g. family).

 

[dsp27]

The only (or one of the few) way to buy in pesos is "en pozo". That is you invest in a building that is still in construction -- often it's just a project. But then you'd have to wait 2-3 years "to get the keys". It can be a great or a disastrous investment. Some people get lucky and get a good return, others lose money or get stuck with a poorly built property that they have to sell at a discount or worse put up living in.

 

[UK Man]

The only (or one of the few) way to buy in pesos is "en pozo". That is you invest in a building that is still in construction -- often it's just a project. But then you'd have to wait 2-3 years "to get the keys". It can be a great or a disastrous investment. Some people get lucky and get a good return, others lose money or get stuck with a poorly built property that they have to sell at a discount or worse put up living in.

Or like a lawyer friend of ours who got stuck with one that has lain semi complete for years.....serves him bloody right too.

 

[jblaze5779]

I would never buy a new or in construction property.

I moved into a brand new apartment as a renter early this year. I was the first person to have lived in this place. It was terrible, the quality the experience of living in a construction zone, everything. This was paying a bundle of dollars for this place and the quality was shiiiiiiiiiittttttt. The plaster was falling off the walls, there were leaks and the windows/doors had huge airgaps allowing the winds to flow right through the apt. It was also very loud all day and night due to the low quality windows and outer envelope.

I had to pay the penalty to move out of this place. I only lived there for a couple months before I had enough.

You want to look for an apartment in a building with an established timeline and a good record of quality and functionality. I ended up moving to a new place from the early 90's across the street. Older yes, but still in very good condition. Also, 1/3 of the price and a pesos contract.

 

[antipodean]

I would never buy a new or in construction property.

I moved into a brand new apartment as a renter early this year. I was the first person to have lived in this place. It was terrible, the quality the experience of living in a construction zone, everything. This was paying a bundle of dollars for this place and the quality was shiiiiiiiiiittttttt. The plaster was falling off the walls, there were leaks and the windows/doors had huge airgaps allowing the winds to flow right through the apt. It was also very loud all day and night due to the low quality windows and outer envelope.

I had to pay the penalty to move out of this place. I only lived there for a couple months before I had enough.

You want to look for an apartment in a building with an established timeline and a good record of quality and functionality. I ended up moving to a new place from the early 90's across the street. Older yes, but still in very good condition. Also, 1/3 of the price and a pesos contract.

Argenquality. In a short sighted country the only thing people can do is make a quick buck by cutting every corner in every step of the supply chain. Yet if you go to Colombia or Mexico and spend the same amount of money on a new project you get something that is actually going to last and suitable for habitation.

 

[Ceviche]

To the O.P

The price of property in Argentina is in USD. this means you pay the exact price as agreed up with seller in USD - CASH or USD - transfer in USD to his USD account abroad or in in USD denominated account in Argentina.

However, the catch is that the price in the sale deed is put in pesos as per the offcial exchange rate prevalent by the central bank. For example, Lets say you buy a house today priced at 100,000 usd by the seller. you will carry 100,000 usd in CASH to the office of the Notary magistrate or where ever you have decided to sign the lease. However, the amount put in the sale deed will be 7,500,000 pesos and NOT 1,7000,000 pesos which is the real value. This means, when the times comes to sale, your tax liabilities or Capital gain tax will be based on appreciation from 750,0000 pesos to the value in official pesos value on day of the sale. Your property taxy ( bien personales) will be based on 7,500,0000 pesos value and not on 1,7000,000 pesos value.

The amount of commission to real estate agent and to the Notary magistrate will be in USD based on real USD value and as defined by percentage agreement with them. None will accept offcial pesos value for their commission.

It means - all persons involved in the deal will only accept USD cash. And all documentation/taxes/excesses basis Government rules will be done basis official pesos rate.

Hope all clear. Feel free to ask me any more questions.