is this the right time to buy a flat in Argentina?

[artigas]

I do not think that Montevideo is a good alternative to BA. Prices here are even higher to those in BA due to a wave of Argentinian flight capital purchases prior to the current restrictions. There is very little demand for short term tourist rentals and longer term rentals are difficult due to very tenant friendly squatter and eviction rights. Taxes are also high and monthly fees are constantly growing due to government meddling. Given the current dollar drought in Argentina, and the lack of Argentine investors, I think you can expect prices here to drop much quicker and lower than in BA. That plus that Montevideo is probably more comparable to Rosario than BA, you will get bored here very quickly.

 

[Ries]

Everybody has a different idea of what a high price is, and what a good deal is- but if you can buy a 2 bedroom in Palacio Salvo for $130k US, I sure dont consider that to be "higher that BA".
An equivalent apartment in an equivalent building and location in BA could easily be double or triple that.
In fact, I dont think you could buy an apartment in a building like Palacio Salvo in any city in the world for anywhere near that little money.

http://realestate.totaluruguay.com/...alacio_Salvo_as_seen_from_Plaza_Independencia

Meanwhile, in Buenos Aires, the 14th floor of Edificio Kavanagh is for sale- for a measly 3.6 Million dollars.
http://www.bastay.com/buenos-aires-real-estate/edificio-kavanagh-14th-floor-reduced-in-price-3-6m

 

[Rich One]

I have a good friend who is a realtor and he tells me that he has sold more properties in 2012 than 2011 . The main reason that sales have gone down he says is that there are much less properties for sale . If you look at the newspapers there are 50% less adds to sell than last year . There is very little desperation from the sellers and if they decide to sell there maybe 10% to 20% discount for cashsales if the price is already high.

50 % less properties for sale, however closings higher in 2012 than 2011... . More efficient real estate salesmen

 

[TrevorCito]

Unfortunately, I dropped my crystal ball in Mrs. Myrkel's 3rd grade art class. Haven't been able to predict anything since then, including women.

The right time depends on your motivation. If you are looking for steals and deals then you should wait until/if there is a crash and frenzy. If you have a reason to come here now, all of the other criteria are aligned, and the property serves your purposes, then you should start shopping in prepartion for the 10-20% reset. Best guess is the next 3 to 6 months.

If you absolutely must invest in property in Argentina, like a moth drawn hypnotized by the light of a fire then what you say is correct. Now is not the time.... but I would add... not now, not ever.

In my humble opinion, an investment in this country is for gamblers, uninformed, misled, masochistic, or for people for whom money is an abstract concept.

I accept that there are those among us who are drawn here for family reasons but apart from that, what compelling reason is there to put on the investment risk?

I cannot overstate the risk but hope by making fun of it a point will be made... If you invest here you're going to blow your investment to hell one way or another but that's ok if you get woody from playing with risk like it's a sex doll.

This country defaulted on billions of dollars and the president thinks it's ok just expropriating companies. She has effectively taught by example that it's cool to steal.

Why would any intelligent, informed person choose to invest in Argentina when there are less riskier investments to be had elsewhere? Damn, you would have more fun throwing greenbacks from the balcony of La Casa Rosada during a workers union protest than enduring the investment uncertainty of an Argentine economic cycle.

There are only two countries on the planet that I know of where you cannot internationally transfer cash directly into a bank account... Russia and Argentina. This means that if you 'legally' buy a property and transfer your money via the central bank, your dollars will be converted to pesos with an immediate 30% devaluation on your investment in favour of the country... wham bam thank you ma'am, "welcome to your Argentine investment, would you like some expropriation with that?"

 

[GS_Dirtboy]

Why would any intelligent, informed person choose to invest in Argentina when there are less riskier investments to be had elsewhere? Damn, you would have more fun throwing greenbacks from the balcony of La Casa Rosada during a workers union protest than enduring the investment uncertainty of an Argentine economic cycle.

Because some really smart people find ways to use the uncertainty to invest and make a profit. If one is looking around the world on where to invest - ie location is not important - then there are other places to invest with greater returns, like Mongolia (not kidding).

If you have reason to be here then real estate is a good investment. By the way, you can get Dollars in and get Dollars out with little problem. That is for both the buyer and the seller. Your comment about the 30% devaluation is not correct.

 

[jeff1234]

. By the way, you can get Dollars in and get Dollars out with little problem. That is for both the buyer and the seller. Your comment about the 30% devaluation is not correct.

How can we get dollars in and out easily?

 

[TrevorCito]

How can we get dollars in and out easily?

If you have dollars, I've heard that there are capital market brokers who will charge a 2% fee to send your USD $ out! Some charge more but be careful as they're probably splitting the commission with the person/expat who introduces them to you. In first world countries, introduction fees are transparently disclosed but not here.

It's a highly risky process without transparency or legal recourse. If something goes wrong, you will have no chance in hell recovering the money.

 

[earlyretirement]

Any ideas when "THAT" will be the time to buy then, when the crisis will be reality down there in Argentina? 1, 3, 7 years?
I agree: the best moment to buy was in 2001-2, next crisis is the time to buy, for sure!
A question: does anybody know how much is the euro now in the parallel market?

No one knows for certain when THAT moment will be. My feeling is within 2 years. I seriously doubt you're going to have to wait many more years before the next crises.

Sure, the best moment was right after the crash but realistically it was very good pickings for several years after the crash but things quickly bounced back once the financial system stabilized and people stopped panicking and figured out that real estate was the one true safe investment in this whacky country.

The best thing is to keep plenty of cash on the sidelines and wait for THAT moment to come and be ready to take advantage of the bargains out there. It's typically the same in any crises. Things run in cycles, especially real estate.

As far as comparing Montevideo and Buenos Aires. It's like comparing apples and bananas. Yeah, they are both "fruit" but one is a sleepy little boring town and one is a vibrant and energetic city full of life.

I totally agree that Uruguay is a GREAT place and has a working banking system, the judicial system works and everything works fairly well. Buying a property there is easy with your passport and selling is also easy. When I bought I just used my passport # and easily wired money into the country and it didn't cost me a penny. When I sold the same deal. I didn't have to worry about the wacky things like in Argentina.

But you can't compare the two and anyone that says that comparable real estate there in Montevideo is more expensive than Buenos Aires is deluded. Montevideo is much cheaper than desirable real estate in Buenos Aires.

While I agree that NOW is NOT the time to buy real estate in Argentina, I disagree with statements like Trevorcito that say that real estate investing in Argentina is only for gamblers or people that want to lose their money. That isn't true either.

If you are buying at the right stage of the boom and crash cycles of Argentina you can do ok if you structure everything properly and legally.

You can buy real estate in many parts of the world and probably do better than Argentina if you're buying at today's prices. But the truth is many of the places you will buy are very boring or you'd never want to visit.

Someone mentioned Mongolia and ironically enough I have a good friend that bought an investment property a few years ago. He claims it was a good investment. But you know what? I wouldn't know or care because I would have NO desire to hang out in Mongolia.

 

[earlyretirement]

If you have dollars, I've heard that there are capital market brokers who will charge a 2% fee to send your USD $ out! Some charge more but be careful as they're probably splitting the commission with the person/expat who introduces them to you. In first world countries, introduction fees are transparently disclosed but not here.

It's a highly risky process without transparency or legal recourse. If something goes wrong, you will have no chance in hell recovering the money.

If you can find a reputable broker that is only charging 2% to safely wire funds out of Argentina I'd jump on that. It's a great deal. Most of the bigger reputable known brokers are charging much more than that right now.

 

[TrevorCito]

Because some really smart people find ways to use the uncertainty to invest and make a profit. If one is looking around the world on where to invest - ie location is not important - then there are other places to invest with greater returns, like Mongolia (not kidding).

If you have reason to be here then real estate is a good investment. By the way, you can get Dollars in and get Dollars out with little problem. That is for both the buyer and the seller. Your comment about the 30% devaluation is not correct.

You are right, I am exaggerating about it being as high as 30%, but it's up there 'through the central bank'.

I would also like to add, for those unfamiliar with how property transactions go down here in Argentina. Forget the clean, safe, low risk bank cheque 'exchange' process you are comfortable with in the first world, here we get down and dirty with real cash... you can almost see the cocaine crystals glistening on the greenbacks as they're being counted by the buyer.

Expect to turn up to the exchange with a suitcase full of greenbacks which may mean carrying hundreds of thousands of bucks with you through the streets of BsAs. Sure, the exchange might be held in a 'secure bank' or in some other pseudo secure location but is it worth the risk?

Beware, on EVERY level.