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Deed boom: The reasons why property purchases are growing and setting the record in recent years
November 23, 2023The operations registered in October are positioned as the highest in the last six years
By Mercedes Soriano
October recorded the largest number of deeds in the last six years in the city of Buenos Aires
October was a month full of uncertainty and expectations. But far from applying a wait and see policy and waiting to define who would be the next president of Argentina to try to predict how the market could evolve, people kept the real estate market more active than ever.
So much so that in October 4,559 properties were registered , a record that can be read as an increase of 53.3% compared to the figures collected a year before. The number encourages real estate expectations, since it proved to be the best October in the last six years.
“To find similar figures you have to go back to the times of the boom in UVA mortgage loans of the government of former president Mauricio Macri . For example, in October 2018, 3,671 deeds had been carried out,” warns Germán Gómez Picasso, co-founder of Reporte Inmobiliario. October operations surpassed those of 2017 - the climax year for the property world - and were 26.32% away from the record of 6,188 operations in October 2017.
The average amount of the acts was $41,950,154 ( US$114,162 according to the average official exchange rate): it grew 207.7% in one year in pesos, and in US currency it rose 33.2%.
In October, 4,559 properties were registered, the best number in the last six years
In general terms, if the figures recorded in 2017 were set aside, the operations recorded in October would be positioned as the highest in the last 10 years. Furthermore, “the average for the months of October since 1998 is 4,813 deeds, so the figure for October this year is very much in line with the historical average of the last 25 years ,” they observed from Reporte Inmobiliario.
“The data for the month of October marks a line of three months of a higher volume than the rest and consolidates a quarter of practically more than 4,000 monthly operations. There are almost 32,000 deeds of sale in all of 2023 : that glass half full gives an increase of 22% in the accumulated of the 10 months compared between 2023 and 2022," says Jorge De Bártolo, president of the College of Notaries of the City of Buenos Aires.
The data arises in a context that continues an upward trend in the number of property sales. Compared to September of this year, when the market had also gone through a summer of sales , the upward trend was once again validated and sales grew by 15.3%.
“There is a feeling of 'let's write now' , so August and September were like December in other years, in which people want to complete all the pending procedures before the end of the year,” he had noted last month. María Magdalena Tato, secretary of the Buenos Aires College of Notaries, an argument that was reaffirmed in October.
The last months of the year already showed an upward trend in the number of operations
“Another positive fact is that we have added 18 months of year-on-year growth . It is a year and a half of not comparing negatively with the previous period, and it gives some peace of mind to get away from a three or four year downward stage,” said the President of the entity.
On the other hand, in October there were 236 deeds formalized with a mortgage. Therefore, the increase in that sense is 98.3% compared to the same month last year. In the accumulated 10 months, the growth is 18.7% (1,366 in total).
The reasons behind the boom
Behind the figure that raises eyebrows there are possible explanations. For Gómez Picasso, the main reason for the increase in operations is the opportunity price at which many properties are published today. “Without a doubt this is mainly due to the issue of low prices,” says Gómez Picasso, and states that “low prices began to drive the purchase of properties a year ago.”Along these lines, he points out that on the one hand, prices have leveled off due to so much demand and that on the other hand, in some segments there are beginning to be moderate reputations for values . The glimpse of recovery of values was evident in different neighborhoods of the city.
There are several examples of this market revitalization. According to Real Estate Report analysis, values in Palermo Soho recovered just above one percentage point after three years of consecutive falls, in Flores they rose 1.61%, Palermo Hollywood revalued 0.91% and in the neighborhood Caballito began to rise by 0.77%, to name a few examples.
The electoral context and the floor of property prices are two reasons that could explain the summer of sales
Other areas, such as southern Palermo, are the ones that most show the phenomenon. In 2023, the price of units in new developments appreciated 3.55% above the price that had been offered in previous years, after three years of a decline that had accumulated 16.2%.
An underlying reason could be the election season and its influence on the purchasing decision. “In the population that had hope that there would be a change in politics and the economy, it could have encouraged the closure of some operations,” analyzed the co-founder of Reporte Inmobiliario.
Aligned with the idea that the elections could have influenced the market is Soledad Balayan, market analyst and owner of Maure Inmobiliaria. “The market has been very active the last two months. “People came determined to carry out the operation, some operations were chained and it is possible that people preferred to write before the elections to minimize exchange rate uncertainty,” she concluded.
Optimism in the province of Buenos Aires
The rise in writings was also echoed on the other side of General Paz Avenue. In the Province of Buenos Aires, the month of October showed a year-on-year increase of 20.75% in the number of sales and transactions reached 9,729, according to the monthly survey carried out by the Buenos Aires College of Notaries.
In the Province of Buenos Aires, the month of October showed a year-on-year increase of 20.75% in the number of sales
In this way, the entity celebrates that October was established as the month with the highest number of operations so far in 2023 and exceeded the 8,852 in September by 9.91%.
“The increase in October operations is a positive fact, since it is the highest value so far this year in terms of the number of sales. We hope that in the coming months the trend continues at this pace and translates into positive signals for the market. The change of government at the national level may represent an opportunity for recovery , for which mortgage credit will be essential,” said Diego Leandro Molina, president of the College of Notaries of the Province of Buenos Aires.
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