Will property prices be pesified

[perry]

Many people are saying that soon property prices will be pesified and all transactions must be done in the local currency . Has anyone else heard this rumour or believe it will happen?

It is hard to predict the effect this will have on the real estate market but for foreigners selling here it not be favourable at all to repurchase those dollars on the black market you will now pay a 15% premium. I am sure that many here will not be happy to sell their property in Pesos.

 

[TheBlackHand]

It should be a done deal by the end of the year. But I don't think it will effect the overall market too much. Sellers will just set the prices at the black market buy rates.

 

[igor]

If you show real property price on paper, wouldn't it work as a valid reason to buy dollars at the official rate?

 

[Crema Americana]

I don't think it will happen. There's a reason why prices are in dollars and that's due to the instability of the peso. The peso is still losing value and inflation is rising, so it doesn't make sense to list in pesos and have to readjust every month.

That said, if the government so chooses (and continues to make dollars hard to get), I could see a mandate or law that says all sales must be in pesos. Perhaps it will make it easier to buy, but foreign sellers may have a hard time quickly dumping (er... exchanging ) all those pesos and hold off on selling - perhaps until they find a buyer that is willing to pay in dollars.

Personally I think individuals (the sellers) should be able to set the price for their property and what currency they want... be it pesos, dollars, or cows.

 

[steveinbsas]

It doesn't matter to me.

Regardles of the "value" of the national currency, I would now only sell any part or all of my property at the spot price of gold.

And buy gold coins the same day...especially if I was Perry...(with whom I agree).

 

[jb5]

Clearly CFK's administration is moving in that direction. There will continue to be serious push back, so who knows what will happen when.

If the question is will the type of real estate foreigners generally buy fall, we can guess more accurately because it's economics and not a CFK whim.

I think Steve will be fairly safe here. His real estate and the RE in the provinces and even just the lower end RE is BA will probably not fall much. But the Palermo, spend a million US fixing up a 200 square meter home, the high end tourist rentals foreigners bought up after the crisis, and much of high end BA in general is in a bubble that will indeed burst.

There are so many reasons for this it's hard to know where to start. CFK's crazy policies, inflation and increasing crime making BA far less attractive to both tourists and wealthier expats. The slowdown in LAM. Multinationals leaving in big numbers. The capital flight that happened in the last 2 years telling us that RE is no longer the safe place to put money........and soooo much more.