Q: Rental Negotiation Vs Inflation

[ghost]

Landlords here are just plain greedy. The only costs to the landlord that will increase are the expenses which you are paying for him/her [it is doubtful that his share of the taxes will increase and really doubtful that he is reporting the income to AFIB]. His 15% per semester factors out to almost 34% per year increase in profit to him. Unless he plans on increasing value received in some way [which is very doubtful]. BTW you can count on being milked as long as you are in Argentina, it's national pastime.

 

[thorsten]

The only costs to the landlord that will increase are the expenses which you are paying for him/her [it is doubtful that his share of the taxes will increase and really doubtful that he is reporting the income to AFIB].

While the increase is definitely on the higher side, just assuming the rental price should not change apart from the expenses is very naive given the actual inflation here.

 

[French jurist]

If real inflation was 27% in 2013 (?), then they are asking for more:

- at 6 months = 15% increase
- at 12 months = 15+((15*15)/100) = 15+17.25 = 32.25%

And etc. for the 18/24 months.

Also, if you accept, you shouldn't raise your security deposit but in fact, they should give back your security deposit indexed according to the same calculation (hence, if you give 10.000, then 12 months later they should give you back 13.250, etc.)

 

[French jurist]

Also, nobody knows what will happen after the Oct 2015 elections. There could be a big devaluation (and bigger inflation?) -> cover your back by checking if the rental agreement tells something about an extraordinary situation or whatever (you might be a winner during the last 7 months of your rental contract... he he)

 

[lucha54]

We found our place at end of December and it came with a clause that rent would go up every 6 months by 12.5%. (my bf is a local and this is an Argy contract, nothing to do with me being a foreigner) 20% once a year is becoming less common. The other place we were considering was 24% after a year, but this was all last year before anyone realized how bad inflation would get after what happened in January.

So NO, it's not uncommon to have an 'every 6 month' clause, but the bad thing is that they're suddenly changing to this after already offering you something else, which psychologically is no bueno. I've heard of 30% yearly too, and that can be hard to digest if you earn in pesos and from one day to the next have to pay 30% more. But in all likelihood, these increases should be in line with inflation and possibly with the exchange rate, as we've seen in the past. So you won't actually be paying more, it will just stay the same or be a tiny bit more. That's just the way it is here. At least you don't earn pesos.

 

[Girino]

Thank you for sharing. This helped us to make a choice.

 

[Rich One]

We have been browsing fora place since we arrived here 10 days ago. We found a nice place in San Isidro Centro for ARS5900/month + exp. We made a written proposal this morning for ARS5800 + exp, with a 25% adjustment for the second year (ARS7520) and gave a ARS3000 deposit.

The real estate agency called back later today to inform us that the owner is now requesting a 15% raise every 6 months to keep up with the skyrocketing inflation rate, instead of a yearly +25% as per their initial request.

We are feeling we are being exploited because we make our income from abroad (we had to explain this because we don't have yet a demonstrable income in Argentina) and we earn dollars/euros.
Is this the norm or is our feeling correct? We didn't come here to be milked off, but to lead a better life compared to where we come from.

Should we assume that the exchange rate will be varying accordingly?

Since you do not have a garantia you are on a 6 month temporary rental deal. nI my building 15 % increases are now being asked for renewal of 6 month leases, assuming a 30 % pa inflation rate.
El Queso comments may be on long term rentals with Garantia or similar . No landlord will accept a 20 % pa increase .
Take it or leave it..!
Good luck

 

[Girino]

Since you do not have a garantia you are on a 6 month temporary rental deal. nI my building 15 % increases are now being asked for renewal of 6 month leases, assuming a 30 % pa inflation rate.
El Queso comments may be on long term rentals with Garantia or similar . No landlord will accept a 20 % pa increase .
Take it or leave it..!
Good luck

I am sorry, where did I write I don't have a garantía? And where did I write about this not being a standard 2 years contract?!
Good luck... but to you. Seriously.

 

[Bajo_cero2]

Now is a good time for buying real state.

 

[Girino]

Now is a good time for buying real state.

We don't know how long we will be calling BsAs "our home", although the price market for buying here is very tempting, especially when you see how much they are charging for renting. However renting out has too many risks here (over the time), so IMHO, it is not the best market where to make real estate investments.