When will property be cheap in Buenos Aires?

[earlyretirement]

Over the long haul, real estate has been a pretty good investment in Argentina. Mark my word, if prices absolutely crashed as it did after the Correlito, you would see people swooping up properties quickly. I don't ever see prices going that low again in Buenos Aires. Kind of like real estate prices in the USA in 2011. In many cities around the USA you couldn't build for anywhere near what many properties were selling for.

Yes, there will be some owners selling because they have to sell but remember by and large, most that own real estate in the Capital own it free and clear and won't be forced to sell. However, definitely as the crises gets worse (which it most certainly will) prices will fall. Not sure how much but they will definitely fall.

 

[perry]

I have been an agent here for over 10 years in Buenos Aires and the market is worse than ever ( surpassing by far the cepo cambiaria of Christina) By my calculations sales have dropped 60% in the last months and very few properties are selling . This is a very worrying trend as it has happened overnight and of course it will get much worse due to the economic situation of Argentina .
Credit applications are virtually nil now as to recieve a basic loan you have to show a monthly ingreso of close to 90000 pesos . Who earns this money ? The real estate market from 2015 to 2017 was a bubble fueled by a cheap peso and credit . I warned many people of this since 2017 but I was called a doomsayer . Those few who listened to me made a killing selling at the top of the market in January 2018 .

The provinces are even worse with real estate transactions down up to 90% in many cities .

https://www.elsol.com.ar/advierten-una-caida-de-90-en-la-compraventa-de-propiedades-en-mendoza

 

[perry]

Over the long haul, real estate has been a pretty good investment in Argentina. Mark my word, if prices absolutely crashed as it did after the Correlito, you would see people swooping up properties quickly. I don't ever see prices going that low again in Buenos Aires. Kind of like real estate prices in the USA in 2011. In many cities around the USA you couldn't build for anywhere near what many properties were selling for.

Yes, there will be some owners selling because they have to sell but remember by and large, most that own real estate in the Capital own it free and clear and won't be forced to sell. However, definitely as the crises gets worse (which it most certainly will) prices will fall. Not sure how much but they will definitely fall.

Prices can crash as proven by many real estate markets over the last 10 years . Athens Greece has the cheapest property price per metre in Continental Europe and has fallen 50% ( and this with a strong currency) . Venezuela with a similar currency to Argentina has fallen 90% . Caracas just 10 years ago was the dearest city in Latin America for property with prices around US$ 4,000 a metre in top neighbourhoods . Now you can buy a property for less than US$ 500 a metre or less in middle class neighbourhoods.

 

[camel]

La Cumbre, Argentina is a small town west of Cordoba, just across the Sierra mountains. When I was living there for a few months, a friend there said if you had showed up after the 2001 crisis with 100,000 euros, you could buy half the town.

 

[perry]

La Cumbre, Argentina is a small town west of Cordoba, just across the Sierra mountains. When I was living there for a few months, a friend there said if you had showed up after the 2001 crisis with 100,000 euros, you could buy half the town.

People live in a bubble and believe prices will go up and up . Speculation always ends badly as proven by many crashes in the world in the past and now . The craziest was the Tulip mania that devasted many middle class families in Holland.

https://www.britannica.com/event/Tulip-Mania

 

[earlyretirement]

I don't think many people are living in a bubble. Almost everyone I know has acknowledged that prices have been very high the past few years. Most of my friends have sold several properties the past year or two while prices are high. I don't think anyone is saying that property prices won't go down over the short-term in Argentina. Property prices during a severe recession go down just about anywhere in the world.

I wouldn't say Buenos Aires is a city where most people speculate. All my friends that own in Buenos Aires bought for the long haul. While they acknowledge that prices will probably dip over the short-term, they aren't going to panic sell their paid off properties that they own 100% free and clear with no mortgages.

If you want to talk about bubbles you can talk about the USA as prices in many cities are past peak bubble prices from before the US recession. And most people are leveraged to the hilt. In Argentina almost no one is leveraged. But I definitely agree with you Perry that prices will go down. But that's totally normal during a severe recession.

I do agree if you aren't planning to hold for the long haul then it's better to sell now while you can as prices are still relatively high. But prices are high and peak level prices in many areas around the world. Definitely owning here isn't for the faint of heart or someone expecting big returns.

 

[Bajo_cero2]

There is a bubble for sure. I did assess the department Where I live and my real estate agent said it cost 175.000 while the owner wants 350.000, exatly double.

 

[earlyretirement]

There is a bubble for sure. I did assess the department Where I live and my real estate agent said it cost 175.000 while the owner wants 350.000, exatly double.

Bajo,

Where is the apartment at? How big is it? What floor? Amenities in the building?

 

[Bajo_cero2]

Bajo,

Where is the apartment at? How big is it? What floor? Amenities in the building?

Uruguay and Paraguay, Recoleta. 2nd floor. 100 mts2. Central heating. 70 years old needing renovation (new) kitchen and bathrooms.

 

[earlyretirement]

Uruguay and Paraguay, Recoleta. 2nd floor. 100 mts2. Central heating. 70 years old needing renovation (new) kitchen and bathrooms.

Yeah, that's pricey if it needs renovations. I sold a totally renovated apartment about 85 sq. meters in Recoleta last year that was in pristine condition and didn't need anything done. I sold it for $300,000 US. I know prices went up since I sold it but I just wanted to sell a few properties while prices were high. I think the odds of that owner getting $350,000 is slim and none these days for the property you mentioned if it needs work.

But my friend just bought a property a few months ago on Ayacucho/Quintana for $470,000 US that was only around 125 sq. meters. Was in great condition. I thought it was a bit pricey but most of the other properties on the market were rubbish and needed a lot of work and the property still seemed cheap compared to where they live.