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Buenos Aires real estate market: Why the purchase and sale of units resurfaced after 5 years of crisis - Infobae
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February 6, 2024
In 2023, a long-term decline began to reverse. What types of apartments have been marketed most recently and what are the most favored areas?
By José Luis Cieri
Experts trust that 2023 will be a pivotal year and the expansion of home buying and selling operations in CABA will continue (Photo: Getty)
The real estate market in the city of Buenos Aires, even with few mortgage credit options, is going through a good moment after 5 years of lethargy in activity. Last year, according to what was surveyed by the Buenos Aires College of Notaries, confirmed a clear improvement. In December, 4,560 deeds were made (12.1% more than the previous month) and 2023 closed with 40,539 notarial acts compared to 33,753 in 2022 (a growth of 20% year-on-year).
Alejandro Braña, Real Estate expert and member of the Buenos Aires Real Estate Professional College, also highlighted that in the comparison of each of the months between 2022 and 2023, there was an improvement in all of them. “The pace of evolution was sustained and permanent throughout the year,” he told Infobae.
The 2023 monthly average of sales and purchases gave 3,378 deeds when in 2021 it barely touched 2,200 monthly notarial acts.
Source: Real Estate Report
Another piece of information provided by Braña is that the total of 40,539 deeds even exceeded the records of the 2013-2014-2015 triennium, since in those years 35,908, 33,693 and 37,392 deeds were registered, respectively.
Experts argue that the recovery was achieved thanks to the fact that those who have genuine savings chose to invest in bricks. Also, because those who managed to sell their properties used the funds to expand or reduce in square meters, but always in real estate operations.
The values of homes for sale had decreased constantly in the last 5 years, to the point that it is estimated that, measured in dollars, the prices of apartments or PHs fell by up to 45% since 2018, to comparable quotes - always in dollars - to those of 10 or 12 years ago.
Alan Schachter, architect and consultant specialized in urban code and land market, highlighted that excluding “the few years with credit and without stocks, the fourth quarter of 2023 was positioned as the most outstanding of the last 11 years, “being only surpassed by the fourth quarters of 2016 and 2017 when more properties were sold leveraged by UVA loans.”
Best sellers
Among the apartments that registered greater commercial activity are those with three and two rooms, especially those that have a balcony and lack a garage, attributes that add additional value and demand up to 20% of the capital necessary to purchase a home.
Two-room apartments among the best sellers in CABA
The PHs in neighborhoods such as Villa Urquiza, Caballito, Colegiales or Palermo, among others, experienced a notable increase in demand, mainly driven by those seeking to avoid the expenses associated with utility bills and reduce costs for home maintenance.
Currently, two-room apartments exceed USD 75,000 for sale and three-room apartments exceed USD 100,000 on average. The PHs range from USD 80,000 on average.
Mariana Lucángeli, who operates in the real estate market in the northern area of Buenos Aires, said that currently, “the final consumer perceives the possibility of making changes, since they can sell at current market values and purchase at the same time, under the same market conditions and rules. In other words, with the difference available, he can make the transition happen.”
For their part, many investors are making trading decisions when they observe that they are buying at values lower than the historical figures in the sector.
“They maintain the expectation of an increase in prices in the medium term, especially if the Government corrects in the short time the macroeconomic disconnections, including inflation, and boosts production,” Lucángeli expanded.
What needs to be improved?
Although the figures show a recovery, the situation is still far from what the sector's most prosperous years were.
Source: Real Estate Report
In years considered difficult, such as 2001, 2002 and 2003, Braña said, 54,493, 56,293 and 61,361 operations were registered respectively. For this reason, he elaborated, “even with the improvement that we see today, we are considerably below the levels of those years marked by the economic crisis of the country and the market itself.”
In fact, if we take into account that in CABA there are 1,970 active notaries, the current numbers indicate that they would be signing 20 deeds per year on average. “It is clear that this account is not so linear; It is simply indicative, since there will be notaries who sign 30 per year and others less than 1 per month,” said Braña.
Given the market history and the most recent data, “a trend of at least 6 months is required in which the number of operations increases, so that there is a firm trend change and it is not an isolated phenomenon. First, the quantities of operations experience variations, and then, if the trend is confirmed, six months later, the prices are also affected,” Schachter concluded.
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