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Buenos Aires improved its position in access to housing: how many years of work are required to buy 60 m2 - Infobae
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www.infobae.com
December 11, 2024
Buenos Aires improved its position in access to housing: how many years of work are required to buy 60 m2
This was confirmed by a private study which revealed that, in 2024, wages now allow access to housing in less time than last year. The improvement in the relationship between income and prices reflects progress in accessibility and a recovery of the local real estate market.
By Jose Luis Cieri
The 2024 preview shows that greater access to mortgage credit and stable economic policies could position Buenos Aires as a more attractive and inclusive real estate market compared to other parts of the world (Illustrative Image Infobae)
A private report, based on an international index, revealed that Buenos Aires showed significant progress in the relationship between income and housing prices. This confirms an improvement in the accessibility of purchasing a 60-square-meter apartment, when compared at a global level.
Although the Argentine capital is not part of the official ranking of the UBS Real Estate Global Bubble Index , prepared by the Swiss bank UBS, Reporte Inmobiliario used its methodology to include it in the analysis.
This index assesses the risk of a real estate bubble and measures variables such as the number of years of income required to acquire a property, rental yields and economic factors such as interest rates and market liquidity.
The latest UBS report, published in September 2024, ranks Hong Kong as the most unaffordable city in the world, where it takes 22 years of income to purchase a typical home.
At the other end of the spectrum, cities like Miami, Madrid and San Francisco have the lowest levels of effort, with only 5 years of income required . If Buenos Aires were included in this index, it would occupy an intermediate position, with 10 years of average income required, according to the calculation made by the portal.
José Rozados , from Reporte Inmobiliario, explained to Infobae : “This improvement is considerable, since just a year ago Buenos Aires required 19 years of income to acquire a property. It is a reduction of almost 50% and reflects the recovery of income in dollars in the face of the moderate increase in real estate prices.”
This progress means that Buenos Aires is no longer ranked second among the most expensive cities to buy a home in terms of income, a position it had maintained in previous measurements.
According to Rozados, the improvement is due to the combination of current prices and higher incomes, although it is still necessary to allocate 33.3% of the gross salary over 30 years for a mortgage loan. Although the ideal would be to reduce it to 5 or 6 years, he points out that going from 19 to 10 years is a significant advance, especially considering the possibility of adding income.
Despite this improvement, Rozados stressed that there is still a long way to go to reach the accessibility standards of the most advanced cities in the ranking: “Something that could be achieved with broader and more sustainable mortgage credit policies,” he stressed.
Source: Real Estate Report based on data from the Swiss bank UBS, which compiles the UBS Global Real Estate Bubble Index. If Buenos Aires were included in the ranking, it would be positioned with a ratio of 10 years of income required to purchase a 60 m2 apartment.
This calculation arises from considering an average price of USD 1,998 per m2 (according to the M2 Index jointly prepared by Reporte Inmobiliario, Re/Max and UCEMA), which places the total value of the unit at USD 119,880, combined with the average remuneration of registered workers in the private sector, dollarized according to the MEP quotation for September.
According to the report, it currently takes 17 years of rent to pay off the cost of a home, compared to 23 years in 2023. This change shows an increase in the profitability of the local market and positions it as a more attractive option for investors.
“The reduction in this indicator is a positive sign. Buenos Aires is beginning to be seen as a competitive market, especially due to sales prices, which are significantly lower than those of the cities analysed by UBS. We are seeing growing interest from international funds that are considering investing in local real estate,” said Rozados.
Source: Real Estate Report based on data from the Swiss Bank UBS, which compiles the UBS Global Real Estate Bubble Index
One of the factors that contributed to this improvement was the growth in the use of mortgage loans . In the last six months, the share of this tool in sales transactions increased by 300 percent.
“This is because current conditions regarding rates, requirements and income are aligned with the ability of buyers to pay. Today, in many cases, the mortgage payment is equal to or even lower than the cost of renting a similar property,” he explained.
However, Rozados warned that, to consolidate this trend, it will be key to develop a mortgage credit culture in the country, something that is not yet rooted due to historical macroeconomic imbalances and high structural inflation.
In the global context, Buenos Aires presents challenges and opportunities. Although it is not part of the official UBS ranking, its improvement in terms of accessibility and profitability positions it as an emerging market with great development potential.
“Buenos Aires is one of the world's great metropolises. Its building and urban quality is on a par with several other cities in the ranking. Now, with competitive prices and a more accessible market, it is beginning to attract the attention of both local buyers and international investors,” concluded Rozados.
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Source:
Buenos Aires mejoró su posición en el acceso a la vivienda: cuántos años de trabajo se requieren para comprar 60 m2
Así lo confirmó un trabajo privado que reveló que, en 2024, el salario permite ahora acceder a una vivienda en menos tiempo que el año pasado. La mejora en la relación entre ingresos y precios refleja avances en la accesibilidad y una recuperación del mercado inmobiliario local
www.infobae.com
December 11, 2024
Buenos Aires improved its position in access to housing: how many years of work are required to buy 60 m2
This was confirmed by a private study which revealed that, in 2024, wages now allow access to housing in less time than last year. The improvement in the relationship between income and prices reflects progress in accessibility and a recovery of the local real estate market.
By Jose Luis Cieri
The 2024 preview shows that greater access to mortgage credit and stable economic policies could position Buenos Aires as a more attractive and inclusive real estate market compared to other parts of the world (Illustrative Image Infobae)
A private report, based on an international index, revealed that Buenos Aires showed significant progress in the relationship between income and housing prices. This confirms an improvement in the accessibility of purchasing a 60-square-meter apartment, when compared at a global level.
Although the Argentine capital is not part of the official ranking of the UBS Real Estate Global Bubble Index , prepared by the Swiss bank UBS, Reporte Inmobiliario used its methodology to include it in the analysis.
This index assesses the risk of a real estate bubble and measures variables such as the number of years of income required to acquire a property, rental yields and economic factors such as interest rates and market liquidity.
The latest UBS report, published in September 2024, ranks Hong Kong as the most unaffordable city in the world, where it takes 22 years of income to purchase a typical home.
At the other end of the spectrum, cities like Miami, Madrid and San Francisco have the lowest levels of effort, with only 5 years of income required . If Buenos Aires were included in this index, it would occupy an intermediate position, with 10 years of average income required, according to the calculation made by the portal.
José Rozados , from Reporte Inmobiliario, explained to Infobae : “This improvement is considerable, since just a year ago Buenos Aires required 19 years of income to acquire a property. It is a reduction of almost 50% and reflects the recovery of income in dollars in the face of the moderate increase in real estate prices.”
This progress means that Buenos Aires is no longer ranked second among the most expensive cities to buy a home in terms of income, a position it had maintained in previous measurements.
According to Rozados, the improvement is due to the combination of current prices and higher incomes, although it is still necessary to allocate 33.3% of the gross salary over 30 years for a mortgage loan. Although the ideal would be to reduce it to 5 or 6 years, he points out that going from 19 to 10 years is a significant advance, especially considering the possibility of adding income.
Despite this improvement, Rozados stressed that there is still a long way to go to reach the accessibility standards of the most advanced cities in the ranking: “Something that could be achieved with broader and more sustainable mortgage credit policies,” he stressed.
Source: Real Estate Report based on data from the Swiss bank UBS, which compiles the UBS Global Real Estate Bubble Index. If Buenos Aires were included in the ranking, it would be positioned with a ratio of 10 years of income required to purchase a 60 m2 apartment.
This calculation arises from considering an average price of USD 1,998 per m2 (according to the M2 Index jointly prepared by Reporte Inmobiliario, Re/Max and UCEMA), which places the total value of the unit at USD 119,880, combined with the average remuneration of registered workers in the private sector, dollarized according to the MEP quotation for September.
Rental profitability
The improvement in the Buenos Aires real estate market is reflected not only in the income needed to buy, but also in the profitability of rentals.According to the report, it currently takes 17 years of rent to pay off the cost of a home, compared to 23 years in 2023. This change shows an increase in the profitability of the local market and positions it as a more attractive option for investors.
“The reduction in this indicator is a positive sign. Buenos Aires is beginning to be seen as a competitive market, especially due to sales prices, which are significantly lower than those of the cities analysed by UBS. We are seeing growing interest from international funds that are considering investing in local real estate,” said Rozados.
Source: Real Estate Report based on data from the Swiss Bank UBS, which compiles the UBS Global Real Estate Bubble Index
One of the factors that contributed to this improvement was the growth in the use of mortgage loans . In the last six months, the share of this tool in sales transactions increased by 300 percent.
“This is because current conditions regarding rates, requirements and income are aligned with the ability of buyers to pay. Today, in many cases, the mortgage payment is equal to or even lower than the cost of renting a similar property,” he explained.
However, Rozados warned that, to consolidate this trend, it will be key to develop a mortgage credit culture in the country, something that is not yet rooted due to historical macroeconomic imbalances and high structural inflation.
In the global context, Buenos Aires presents challenges and opportunities. Although it is not part of the official UBS ranking, its improvement in terms of accessibility and profitability positions it as an emerging market with great development potential.
“Buenos Aires is one of the world's great metropolises. Its building and urban quality is on a par with several other cities in the ranking. Now, with competitive prices and a more accessible market, it is beginning to attract the attention of both local buyers and international investors,” concluded Rozados.
www.buysellba.com
