Is real estate price converted to pesos at purchase?

[Alpinista]

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 750,000 pesos and NOT 170,000 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 750,0000 pesos value and not on 170,000 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.

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

I think you meant 1,700,000 pesos. Not that i blame you with all the zeros....

 

[Alby]

Or, the value written on the escritura can also be stated in US$, but not in the amount of US$ you handed over to the seller, instead in a much lower amount.

 

[Ceviche]

The value written on the escritura can also be stated in US$, but not in the amount of US$ you handed over to the seller, instead in a much lower amount.

No. Please don't spread wrong info.

 

[Alpinista]

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.

USD is certainly be the normal case.

However, it can also be in pesos (the buyer might have pesos, and the seller needs to settle a debt in pesos). In my case, it was even paid in Euro as the seller wanted to have it in Euro on an account in Italy.

 

[on the brink]

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.

Saw the same thing in new housing developments in the US. Construction flaws are papered over, and the developers end up knee-high in lawsuits.

 

[Alpinista]

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.

Sorry, Ceviche. I think your numbers are still incorrect. ;-)
It should be 100'000 usd 7,500,000 pesos and 17,000,000 pesos ...
But it is a very valid point because, buying now with the Cepo gap that big, it means that this is potentially beneficial for the buyer as property taxes (and also for the wealth tax, for those having the tax domicile here) will be based on the official rate. At least that's my understanding....

 

[cortes]

Thanks everyone for all the response, sounds pretty clear now

Yeah It did seem too good to be true. Now I'm left wondering how is it that locals can buy property? I'd imagine that between inflation destroying your savings, and the fees for converting your savings to USD, most locals cannot dream of buying property. I've read that there are very low limits to how much you can officially change to USD, so that leaves locals going through dólar blue exchanges when trying to buy property? All around sounds like an incredibly broken system

 

[Ceviche]

USD is certainly be the normal case.

However, it can also be in pesos (the buyer might have pesos, and the seller needs to settle a debt in pesos). In my case, it was even paid in Euro as the seller wanted to have it in Euro on an account in Italy.

Yes, you can pay in pesos, usd, euros..but sale deed will be written in pesos at official rate of the day of the signature.

no buyer will ask to be paid in pesos at official pesos rate. if they accept pesos, probably will ask for the highest exchange rate prevalent on the day, which will be decided basis the dollar price.

 

[Ceviche]

Sorry, Ceviche. I think your numbers are still incorrect. ;-)
It should be 100'000 usd 7,500,000 pesos and 17,000,000 pesos ...
.

Not really - zeros were ok. Only typed the comma wrong.

 

[Greg S]

Use Airbnb and rent a number of places before you consider purchasing. You can find everything from Patagonian lake houses to Palermo Chico penthouses. All fairly inexpensive now.