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Moving to BA the easy(ish) way - Time Out Guidebook
August 08, 2008
Germán Peterson steers you through the minefield of buying property in BA
By Germán Peterson | Summer/Autumn 2007
Argentina has great real estate to offer. Whether you fancy a stunning penthouse apartment overlooking Buenos Aires, a chalet in Patagonia, a winery in Mendoza or just a nice pied á terre, price are still a fraction of what you would pay in the UK or in the US. And the quality of what is offered is amazing: all properties are in freehold, tiresome co-operative boards are unknown and maintenance fees and taxes are very low.
Buying property in Argentina seems quite easy at first glance, but after getting stuck in the Argentinean bureaucracy, or getting to know some of the local business practices, you will realize that in order to get your deal done smoothly you need to bear in mind some rules:
One – There are hardly any private offers in the market and nearly everything in the market and nearly everything is offered via real estate agents. But unlike in the US or in the UK, realtors are not responsible for the accuracy of their offer, so it is always best to double check.
Two – Never agree immediately on the offered price. If you do so, the seller will think he placed the offered price too low and will ask for at least 10% more. No matter what you feel about the price, always place a lower offer – at least five per cent below the asking price.
Three – Cash is king: real estate deals in Argentina are nearly always done in cash. Even if you are paying millions, when the deed is signed the buyer and the seller meet together in a bank to count bundles of greenbacks.
Four – Black is beautiful. Sadly, it is common practice to pay a part of the purchasing price in ‘black’, that is, beneath the radar of the tax man. But to avoid problems later on, if the amount that figures in the deed is at least 70% of the actual price paid or better, you should do the whole deal in ‘white’.
Five – All deals are in US Dollars, but getting them into the country is not that easy. To avoid speculation on the peso, Argentina introduced a law in 2005 stating that all transfers by non-resident foreigners are subject to a 30% withheld retention for one year unless the purpose of the transfer is a direct investment in real estate, production, and so on – and proving that is a bureaucratic hassle.
Six – Make a good choice when selecting your notary public (escribano). He or she is the person who prepares the deed, checks all the papers and documents and makes sure that all bills and duties are paid. He or she is the one who finds out if there are any legal encumbrances, liens or defects in the title, and if there are, how they can be solved.
Seven – Argentineans are not well known for their taxpaying discipline – but you should be. Non-resident foreigners have to request prior approval from the AFIP (the local version of the IRS), before selling their property. And be prepared; these guys are much smarter than you probably think. Not only will they check if you have paid the municipality duties, property and wealth taxes, but they will also look into your utility bills, to find out if you have rented out your apartment while not resident in Argentina.
Keep in mind these few suggestions and you will be able to enjoy the apartment/house/estancia of your dream for many, many years, as have done many celebrities such as Ted Turner, Michael Douglas, George Soros, Luciano Benetton, Maia Sworowski, and Sylvester Stallone. Happy Hunting!
Some recommended agencies
ApartmentsBA
August 08, 2008
Germán Peterson steers you through the minefield of buying property in BA
By Germán Peterson | Summer/Autumn 2007
Argentina has great real estate to offer. Whether you fancy a stunning penthouse apartment overlooking Buenos Aires, a chalet in Patagonia, a winery in Mendoza or just a nice pied á terre, price are still a fraction of what you would pay in the UK or in the US. And the quality of what is offered is amazing: all properties are in freehold, tiresome co-operative boards are unknown and maintenance fees and taxes are very low.
Buying property in Argentina seems quite easy at first glance, but after getting stuck in the Argentinean bureaucracy, or getting to know some of the local business practices, you will realize that in order to get your deal done smoothly you need to bear in mind some rules:
One – There are hardly any private offers in the market and nearly everything in the market and nearly everything is offered via real estate agents. But unlike in the US or in the UK, realtors are not responsible for the accuracy of their offer, so it is always best to double check.
Two – Never agree immediately on the offered price. If you do so, the seller will think he placed the offered price too low and will ask for at least 10% more. No matter what you feel about the price, always place a lower offer – at least five per cent below the asking price.
Three – Cash is king: real estate deals in Argentina are nearly always done in cash. Even if you are paying millions, when the deed is signed the buyer and the seller meet together in a bank to count bundles of greenbacks.
Four – Black is beautiful. Sadly, it is common practice to pay a part of the purchasing price in ‘black’, that is, beneath the radar of the tax man. But to avoid problems later on, if the amount that figures in the deed is at least 70% of the actual price paid or better, you should do the whole deal in ‘white’.
Five – All deals are in US Dollars, but getting them into the country is not that easy. To avoid speculation on the peso, Argentina introduced a law in 2005 stating that all transfers by non-resident foreigners are subject to a 30% withheld retention for one year unless the purpose of the transfer is a direct investment in real estate, production, and so on – and proving that is a bureaucratic hassle.
Six – Make a good choice when selecting your notary public (escribano). He or she is the person who prepares the deed, checks all the papers and documents and makes sure that all bills and duties are paid. He or she is the one who finds out if there are any legal encumbrances, liens or defects in the title, and if there are, how they can be solved.
Seven – Argentineans are not well known for their taxpaying discipline – but you should be. Non-resident foreigners have to request prior approval from the AFIP (the local version of the IRS), before selling their property. And be prepared; these guys are much smarter than you probably think. Not only will they check if you have paid the municipality duties, property and wealth taxes, but they will also look into your utility bills, to find out if you have rented out your apartment while not resident in Argentina.
Keep in mind these few suggestions and you will be able to enjoy the apartment/house/estancia of your dream for many, many years, as have done many celebrities such as Ted Turner, Michael Douglas, George Soros, Luciano Benetton, Maia Sworowski, and Sylvester Stallone. Happy Hunting!
Some recommended agencies
ApartmentsBA
