Prices for temporary rentals

[syngirl]

I don't think that BA will continue to be a tourist destination the way it has been the past 6-8 years or so if the prices continue to rise and with the Euro low. The Canadian dollar is basically at par with the USD right now, and I know amongst my friends from home, who are well travelled, look at it and think "Hmm.... from Vancouver I can spend 1200 or more dollars and fly 23 hours down to Argentina and lose a day of my holiday on either end, or I can fly 9-10 hrs to Europe where maybe my dollar is worth less but my plane fare is cheaper, I don't lose as much time travelling, and the food is good"

While the Euro is low, I think a lot of people are going to take advantage and go -- we even were going to go ourselves from BA, but missed the seat sale. At one point it was 1100 USD all incl fly in Paris, fly out Barca. We missed the sale, now looking at Venezuela or Colombia. Guess how much tix are to Caracas and Cartagena for travelling the same weeks as we would have if we had got the seat sale to Europe? 1100 USD after tax. Cripes.

 

[Ashley]

From what I've heard/seen this is the natural cycle of argentina. Something happens to the currency, everything becomes cheap (for foreigners) and then prices rise and rise for about 10 years before everything crashes again. I guess if you're used to this way of life, holding out to get high rental prices doesn't seem as risky (especially when you look at the cost of purchasing new furniture, electronics, etc - I'm not surprised many of these owners would rather keep their places in tiptop condition than rent them out all year round).
As a foreigner who has been here a good few years though I'm still surprised by the extent of it - especially in shops. If one store raises it's prices, the rest follow suit and don't seem that bothered about increasing their competitive edge with fairer pricing AT ALL. I find it particularly amusing now to go into some of the nicer (but still high-street) shops along Cabildo and Santa Fe only to find average quality/label clothes priced as if they'd just trotted off a Parisian catwalk!! I unfortunately fell in love with a pair of boots from Las Pepas the other week only to discover that they're almost 800 pesos! If a similar level store in the UK were to start pricing like that, they'd be out of business within weeks... I guess that's Argentina for you - Maybe once we're a year or so deeper into this current cycle, I might be able to afford them! :S

 

[perry]

The reason that prices are increasing so rapidly is that Argentina is the policy of keeping the peso at a stable rate to the dollar since the last year . It has been around 3.80 to 3.90 in this period while in other Latin American countries like Brazil and Uruguay their local currencies have dramatically increased in value against the dollar.

This time there will not be a crash of the currency as the currency is artificially weak .What I believe will happen is a slow appreciation of the Peso to a more stable level .

I remember 2 to 3 years ago that many here said that real estate prices and rental prices would crash and the reverse has happened. Its easy to understand that people are not hoarding dollars due to this crazy inflation that devalues your earnings in pesos currently at over 20 percent per year.

Anyone who has kept dollars have effectively lost 20% of their savings in the last year due to the stable peso. If you had brought a cochera ( garage) or small one bedroom you would have appreciated your investment as well as had a rental income.

These figures below from the Camara Immobilaria Argentina show an increase in sales of close to 30% since 2009 .
http://www.cia.org.ar/noticia.php?i...20afirma%20la%20recuperaci%F3n%20inmobiliaria

 

[steveinbsas]

......Don't seem to go down do they?

This keeps surprising me because if you look at the websites they rarely get 40 to 50% occupation. Tourism is bit up from 2009 but that does also surprise because Argentina is keeping getting more expensive which should make Argentina especially for long-term tourist less attractive

How do you see the next 6 to 12 months?

Only a very small percentage of apartments in BA are offered for short term rental to tourists. The rates for these apartments have not increased greatly in the past four years while the cost of many other items have more than doubled. Argentines who own apartments that they do not occupy in the tourist zone often do so as an investment rather than holding cash, especially Argentine pesos. If the average short term occupancy for a given apartment is 40% I would imagine most owners are happy with the cash flow. At the same time their wealth is literally set in stone.

The expression "long term tourist" is a contradiction in terms.

 

[Sleuth]

I agree that prices tend to remain stable and even increase. At 40% - 50% occupancy, many people are making a good return on their investments. Remember, there are no mortgages here (for the most part), so people own these apartments outright with relatively low monthly expenses (electricity, gas, cable, etc.).

That being said, real estate prices continue to rise here, especially in "trendy" neighborhoods. Prices in Palermo Hollywood have gone up almost 30% in the last year to year and a half. This will contribute to an increase in rental prices as well.

Also, by law, renting to foreigners is limited to 6 month contracts. Given that they do not have guarantias and need furnished apartments, this also adds to the price.

 

[davonz]

The peso has gone from close to 3 pesos in january 09 to close to 4 pesos today, so it in effect has lost around 1/3 of its value in 1 1/2 years.

Other countries that are commodity exporting economies, like arg have gone the other way, NZD from 1.70 to 1.40 to a US$, AUD 1.40 to 1.10,BRL 2.30 to 1.80.
Why is that ?
I know NZ, AU and BR currencies have gone up against the US$ because exports have increased, and their economies are growing, why hasnt the AR peso gone up also ?

From what a local ecomonist told me the only reason the peso hasnt dropped further is because the arg central bank is spending 100 of millions US$ buying the peso back, which is keeping it artificially strong. How long can they keep doing this ?

 

[MLK]

From what a local ecomonist told me the only reason the peso hasnt dropped further is because the arg central bank is spending 100 of millions US$ buying the peso back, which is keeping it artificially strong. How long can they keep doing this ?

Many economists have suggested that the peso will finish the year at between 4.30 - 4.50 to the dollar. However, these dudes are frequently wrong. That said, inflation is picking up momentum again and the peso cannot stay below 4.00 for very much longer. If it does, and with our wage increases, we'll all be holidaying in Miami before too long.

 

[MLK]

From what a local ecomonist told me

Thinly veiled 'I'm in with the local city boys'.

 

[WelcomeMendoza]

CDS spreads in the financial markets are widening for Argentina...what goes up...someday comes down...and then goes up again..lol

 

[davonz]

From what a local ecomonist told me

Thinly veiled 'I'm in with the local city boys'.

the "local economist" i know works in a gov department, so i am not sure if i am in with the "city boys" or not !