Will the Economic Crisis in the USA Effect Argentina?
- Thread starter Dudester
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Smartypants
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DA said:
When was the last time such an EPIC FAIL happened in the banking system, world power balance and currency balance? It's like a heart attack or a computer-banking-crash, but it's mostly rich people and governments that have the most to lose
But I don't fear the future, I play the game and look for opportunities
DA said:
Wolves cooperate, much smarter way of surviving
+ plus wolves are free I think saavy investors will shift their paper assets into hard assets, aka real estate. Why not invest in a country where real estate prices are so reasonably priced? An comparable apartment in London, NYC, Paris, or any other comparable city to BA would be at least 5 times the price. THere are lakefronts around Bariloche for under 500K, a fraction of what they would be in a place like Lake Tahoe, the closest thing besides Switzerland I can think of.
I have always been an OPM (Other People's Money) guy, and I know of few other places in the world where purchase prices to rental income ratios are as favorable, both in BA and in the Bariloche area, where I live.
I have been surprised by the amount of inquires I have received for rentals in the last 2 weeks. I would have thought the s t hitting the fan would make people not want to travel, but summer bookings have been en fuego.
I have always been an OPM (Other People's Money) guy, and I know of few other places in the world where purchase prices to rental income ratios are as favorable, both in BA and in the Bariloche area, where I live.
I have been surprised by the amount of inquires I have received for rentals in the last 2 weeks. I would have thought the s t hitting the fan would make people not want to travel, but summer bookings have been en fuego.
It seems obvious that Argentina will be impacted by the crisis in the US and Europe. Let's not forget that the banking crisis began months ago with Northern Rock in the UK. Europe is in s terrible state with growing unemployment and a high euro that makes exports very difficult. A lot of Americans have lost money in the current financial crisis. Today I was talking to a friend in the US who had investments with Lehman Brothers and AIG. Needless to say he is really upset. It seems obvious that there will be less money available for buying property in Argentina. I think we need about 6 months to see what happens. The same for real estate in the US. Six months should tell us how prices have been affected.
As for McCain provoking a recession...the recession has already arrived. Neither candidate has an exit strategy but Obama has one for making matters a lot worse: an increase in taxes including capital gains tax. How on earth he thinks he can implement a national health plan and all of his other social spending programs without major tax hikes is beyond me. And this in the midst of a deep financial crisis!
In the end both Obama and McCain voted for a whopping bailout plan that will burden the taxpayers for generations to come. In fairness to McCain, he did predict this a couple of years ago when he begged Congress to approve regulatory measures that could have saved Fannie Mae and Freddie Mac. Republicans voted for the measures while Democrats rejected it.
As for McCain provoking a recession...the recession has already arrived. Neither candidate has an exit strategy but Obama has one for making matters a lot worse: an increase in taxes including capital gains tax. How on earth he thinks he can implement a national health plan and all of his other social spending programs without major tax hikes is beyond me. And this in the midst of a deep financial crisis!
In the end both Obama and McCain voted for a whopping bailout plan that will burden the taxpayers for generations to come. In fairness to McCain, he did predict this a couple of years ago when he begged Congress to approve regulatory measures that could have saved Fannie Mae and Freddie Mac. Republicans voted for the measures while Democrats rejected it.
...as for percieved quality of life - I should change Athens to Istanbul but I believe the 'city' is better comparable with the three I suggested for population, rich/poor, colonial architecture, infrastructure, bureacracy, fun factor etc.
A 1 bed apartment for 100k is rare these days that would provide a +/- 10% return you would have to have full (tourist) occupancy for the 12 months solid - again rare.
I would agree that the rental return is better than most places (max 7% better than any bank) but the capital growth is slim to nothing and the hassle involved in letting here is immense (costs of transaction, time, commisions etc etc).
...and redeeming your investment as stanexpat has pointed out is not simple by any means.
caveat emptor - no truer words than these in BsAs.
A 1 bed apartment for 100k is rare these days that would provide a +/- 10% return you would have to have full (tourist) occupancy for the 12 months solid - again rare.
I would agree that the rental return is better than most places (max 7% better than any bank) but the capital growth is slim to nothing and the hassle involved in letting here is immense (costs of transaction, time, commisions etc etc).
...and redeeming your investment as stanexpat has pointed out is not simple by any means.
caveat emptor - no truer words than these in BsAs.
My old apartment in Recoleta across from the cemetary, was getting over $800 a month (that was long term rental, if we short termed it, it would be higher some months and lower others) and was sold for under 100k earlier this year. We sold it for another project we are now involved in. I have also sold my finca property in Mendoza province, so I don't believe the redeeming investment being so hard. We also have a house for sale in California, now that is a challenge to sell.
FF, you don't rank BA's fun factor and architecture high on the list? Why do you live in BA?
FF, you don't rank BA's fun factor and architecture high on the list? Why do you live in BA?