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Rentals: After the DNU, 70% of new contracts are agreed for two years with quarterly adjustments - Infobae
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Alquileres: tras el DNU, el 70% de los nuevos contratos se pactan a dos años con ajustes cuatrimestrales
El análisis además reveló que la oferta de viviendas subió un 50% interanual en todas las plazas examinadas. Este avance emerge en un contexto de acuerdos desregulados que impulsó a propietarios a migrar unidades antes destinadas a la venta hacia locaciones
www.infobae.com
February 12, 2024
A report revealed that the supply of housing rose 50% year-on-year in all the places examined. The repeal of the previous law prompted owners to migrate units previously intended for sale to locations
By José Luis Cieri
The trend of greater housing supply throughout the country begins to take hold after DNU that repealed the Rental Law (Illustrative Image Infobae)
Under the context of the repeal of the Rental Law through the DNU issued by the Government, a notable dynamism was evident in the rental market. This regulatory change generated a constant increase in the availability of housing. A private analysis confirmed a year-on-year growth in supply that exceeds 50% on average in all the places examined.
This was confirmed by the work carried out by the Federal Council of Real Estate Associations (CoFeCI), which also revealed that when examining the migrations of sales properties to the housing rental market in three of the largest cities in the country, a notable similarity is observed, with percentages higher than 52% year-on-year.
In the city of Buenos Aires, real estate brokers confirmed that in the first 40 days since the implementation of the DNU, there was a notable migration of owners who moved their homes, previously intended for sale, to the rental market. This phenomenon represents 55% of the total. In Rosario, the trend is even more pronounced, with a percentage that rises to 58%; Meanwhile, in Córdoba, 52% of owners chose to migrate their properties to the rental offer in the same period.
And the report confirmed that 70.3% of new contracts are agreed with terms of 2 years , and 11.5%, 3 years, and 11.2% 12 months (see graph below)
Source: Federal Council of Real Estate Associations (CoFeCi)
Regarding the adjustment deadlines, the most implemented method is the quarterly method with 30.2% of the agreements, followed by the quarterly method with 24.4%, and the semiannual method with 22.9 percent.
Source: Federal Council of Real Estate Associations (CoFeCi)
Virginia Manzotti , president of CoFeCI, told Infobae that “to consolidate agreements between owners and tenants, it is essential to have a precise understanding of the situation of both parties when agreeing on the deadlines and adjustment rates. The active participation of a registered broker in the preparation of agreements provides legal security to both parties, ensuring an agreement backed by professional advice.”
Adjustment methods
Regarding the preferred indices to adjust the new contracts, the study confirms that the Rental Contracts Index, derived from the average between the Consumer Price Index (CPI) and the Average Taxable Remuneration of Stable Workers (RIPTE), leads with 52.2% of post DNU applications.
Source: Federal Council of Real Estate Associations (CoFeCi)
César Fernández Cívico , treasurer and one of the coordinators of the CoFeCi statistics center, highlighted that “on the list, the most implemented adjustment method after the ICL is the CPI, used in 44.7% of the cases, while “The Own Home Index was selected in only 2.6% of the operations.”
Point
Experts point out that the initial costs of the contracts, which in CABA experienced an increase of 308.1% year-on-year , were affected by the increases generated by the previous legislation, generating notable chaos in the market. Currently, supply and demand are contributing to the stabilization of values, the segment considered.“With greater supply, tenants are faced with various options, which leads to a balance in rental prices. It is important to highlight that housing contracts are being finalized in national currency, while in some parts of the country, commercial rentals and homes in gated communities are negotiated in foreign currency. These adjustments reflect an adaptation of the market to new dynamics,” added Manzotti.
Contracts and advice
According to the new framework of “freedom” in contracting, diversified negotiations are currently observed in relation to various factors that affect contracts.Fernández Cívico highlighted: “What we found most is related to the periodicity of the adjustments, rather than the type of index applied in each contract. Normally, the aim is to align the periodicity of the adjustments with salary increases, thus avoiding mismatches between a person's income and the rent adjustment."
It is essential to highlight the differences between the various regions of the country, as well as the specific characteristics of each city. CoFeci insists on the importance of a federal perspective that implies national agreements respecting the characteristics of each province.
The current macroeconomic situation presents challenges when renewing contracts, so the dialogue about values, indices and terms acquires crucial relevance.
Source: Federal Council of Real Estate Associations (CoFeCi)
Manzotti stressed: “Today, several tenants, given their circumstances, prefer to agree to contracts adapted to their needs, even with durations of less than 24 months, and owners are accepting this flexibility. It is imperative to keep in mind that the reality in cities like Córdoba capital or CABA) may differ significantly from places like Neuquén or San Luis. The institution advocates a federal approach in general, respecting the particularities of each region individually.”
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