When are apartment prices finally going to fall??

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wandererbird

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I'm starting to get annoyed at this. In 2008 I rented a place in Palermo with 1 br. and a nice terrace for $800 a month, in a new building with pool. Now that apt. is up to $1200 a month (50% increase in one year!) and for $750 or $800 you can only get a basic studio with no porch. These prices are ridiculous and comparable to the US...why would I pay $1200 in Buenos Aires? I know a lot of expats are just not coming anymore and many have left. Don't the owners and agencies here realize their greed is going to make the market collapse? I'm leaving Argentina. I hope the prices will come down again soon, I'm wondering if anyone has any opinions on WHEN that might be.
 

ElQueso

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I have noticed, in many cases, that Argentinos seem to want to do the opposite of what a free market would nomally have them do when business falls off. I.e., they tend to raise prices to get more money from fewer customers instead of lowering prices in order to attract more people to their business.

I don't know that I would look at prices falling, at least for tourists, any time soon. Most people own their apartments outright - mortgages are difficult to impossible to get here so they are not usually trying to ensure that they have enough income from the apartment to offset their mortgage payment and can therefore ask the higher price than one would normally think.

Prices in long term rentals seem to have stabilized and maybe even dropped a little. I've been looking for an apartment in town and have been surprised at some of the deals that I've come across.

But those long-term rentals are not priced for foreigners who are renting temporary apartments. They are two different markets and you are talking about the market that will always try to attract the higher-paying crowd. When there are no more tourists who are willing to pay the prices, the prices will fall, after awhile.

BTW - a furnished apartment for $800 USD a month, even if it's a studio, is only $27 USD a day. Much, much cheaper than hotels. Even at $1200 USD for a one bedroom apartment, you are still looking at $40 a day, and I don't think there are any hotels here in Buenos Aires that are worth staying in for the same price, compared to how nice a big a one bedroom apartment is to a little hotel room in one of the cheapest hotels in the city.

I guess what I'm saying - it's all relative...
 

bradlyhale

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It's important to remember that most, if not all, of these places include cable TV, high speed internet, telephone service, water, electric, and even maid service.

I rented a one-bedroom place in rural Missouri for $425, and after utilities I was easily paying $700-$750 USD per month. It would be significantly higher in St. Louis or Kansas City, which for many are noncities anyway! haha You can find a studio in Buenos Aires with everything included for $550. You just have to shop around.

Have you ever seen the rents in New York City?
 

wandererbird

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bradlyhale said:
It's important to remember that most, if not all, of these places include cable TV, high speed internet, telephone service, water, electric, and even maid service.

I rented a one-bedroom place in rural Missouri for $425, and after utilities I was easily paying $700-$750 USD per month. It would be significantly higher in St. Louis or Kansas City, which for many are noncities anyway! haha You can find a studio in Buenos Aires with everything included for $550. You just have to shop around.

Have you ever seen the rents in New York City?
Yes I have and you can rent a 1-br. (although small) in LES or Williamsburg BK, the hippest neighborhoods, for about $1700, which is the price of a lot of the places listed by agencies here or on craigslist...and it's in BUENOS AIRES. The whole point of being here is it's supposed to be cheap. If it's only marginally more expensive for me to be back in NY, then I'll go back there.

Yeah you can find a cramped studio in BA for about $500-$600 but what's the point of living on a tight budget in Argentina?

As of now I'm looking to Brazil (where prices are also high due to falling dollar). But there are places in the world with more reasonable prices for apts., in Asia for example, and long-term expats will probably gravitate toward those.
 

ssr

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wandererbird said:
If it's only marginally more expensive for me to be back in NY, then I'll go back there.
Dude, it's A LOT more expensive in NYC. Buenos Aires is certainly getting more expensive but it's still a bargain compared to large first-world cities.

And you think Brazil is cheaper or a better bargain somehow? I've only been to Brazil as a tourist but it's always been a lot more expensive than Argentina, even in the north.
 

wandererbird

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ssr said:
Dude, it's A LOT more expensive in NYC. Buenos Aires is certainly getting more expensive but it's still a bargain compared to large first-world cities.

And you think Brazil is cheaper or a better bargain somehow? I've only been to Brazil as a tourist but it's always been a lot more expensive than Argentina, even in the north.
I'm afraid you're right but I miss Brazil, and the people there are friendlier. Argentina's prices are still good, but they have to lower these apt. prices to really make it very attractive to long-term expats.

As for NY...yes it's most expensive, but at this point not by as much as you say, at least not in terms of rent. I have a friend who was renting a 2-floor place on Quintana in 2005 for $450...it would probably be like $1800 now, give me a break. I was paying $800 last year, it's $1200 now...that's robbery...
 

jp

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Wanderbird, where are you looking? If you are looking for a place doing tourist rentals, they cater their prices for people who are only going to stay a few weeks. Buenos Aires is still popular with tourists, and there's a high demand for property in the best areas.

The apartment next to me is a temporary rental. I'd guess it rents for 3 months a year tops, but in that time they probably make as much in rent as I pay for my place for a year. Plus there's less wear and tear, lower bills, low maintenance etc.

I can see why they'd do it. Rent to tourists, keep your property in good condition for longer and make about the same as a long term rental.
 

ElQueso

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wandererbird said:
As of now I'm looking to Brazil (where prices are also high due to falling dollar). But there are places in the world with more reasonable prices for apts., in Asia for example, and long-term expats will probably gravitate toward those.
Prices were high in Brasil before the falling dollar. It has to do with more that Brasil has better industry and fewer bad import/export laws than Argentina and the Real was getting strong as a result of their economy.

I think temporary apartment prices here are still reasonable, particularly when compared with the cost of living in a hotel. Yes, they have risen. But I have three different expat friends who rent temporary apartments and they still have no problem renting out the space even though prices have risen.

To a perma tourist this is all a different story, of course - perma tourists are caught in the middle.
 

Denver

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ElQueso said:
I have noticed, in many cases, that Argentinos seem to want to do the opposite of what a free market would nomally have them do when business falls off. I.e., they tend to raise prices to get more money from fewer customers instead of lowering prices in order to attract more people to their business.
This is my observation too and it is mind-numbing. The state is an enabler in this with their import restrictions. High tariffs serve only to buy votes and to develop bad domestic business practices.

Neil
 
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