Explore, connect, thrive in
the expat community

Expat Life: Local Discoveries, Global Connections

Apartment Rental Rentals: The formula for contracts that keep landlords from losing money - La Nacion Propiedades

BuySellBA

Administrator
Rentals: The formula for contracts that keep landlords from losing money - La Nacion Propiedades
1741903376402.png


Source:






March 11, 2025


The combination of increased supply, more affordable prices, and contractual flexibility opened a new chapter for the rental market.




rs=w:1280

Rentals:CrizzyStudio - Shutterstock

The rental market underwent significant changes throughout 2024 , following the repeal of the rental law on December 29, 2023, when DNU 70/2023 came into effect . This regulatory change eliminated the mandatory three-year term and the annual adjustments regulated by the Lease Contract Index (ICL), and semi-annual by Casa Propia (after the update in October 2023) - the latter being just a few - , allowing for greater flexibility in agreements between tenants and landlords.



In early 2024, adjustments began to be made mostly every two to three months , based on the Consumer Price Index (CPI) and lasting for two years; however, the slowdown in inflation, combined with a significant increase in property supply, has allowed these conditions to be reconsidered .



The relaxation of contractual conditions brought about a notable recovery in the market . According to data from the Real Estate Observatory, the supply of rental properties grew by 200% compared to the period regulated by the rental law. This increase had a positive impact on prices, which rose below inflation, resulting in an average real price decrease of 36.8% .



Landlords , previously reluctant to rent due to the restrictions imposed, returned to the market, encouraged by the ability to negotiate terms, adjustments, and payment conditions more freely. Tenants, for their part, are finding more options available and have the leeway to make counteroffers, which are increasingly accepted.





rs=w:1280

Under what conditions are new rental contracts signed?Wasan Tita - Shutterstock





The new dynamics of contracts​

The Buenos Aires Real Estate Association report reveals that 90% of current rental agreements are in pesos, despite the fact that they are permitted to be agreed in foreign currency, and are closed with quarterly adjustments for 24 months and using the CPI indicator , although some are still being agreed under the ICL. This trend reflects a consensus among the parties to achieve more balanced agreements adapted to the inflationary context. Despite these changes, there are still tenants with contracts in force under the old regulations .



What would have to happen for adjustments to be more widely spaced? Specialists agree that the key to further extending adjustment periods lies in the continued slowdown in inflation . With a more stable economic environment, owners would feel more confident offering contracts with semiannual adjustments , a scenario that until recently seemed unattainable.

A key finding shared by the survey is the distribution of rental supply by neighborhood. It mentions that six neighborhoods account for more than half of the entire city of Buenos Aires: Palermo (with the largest supply, at 22.62%), Belgrano , Recoleta , Barrio Norte , Caballito , and Puerto Madero , which account for 58.96% of the city's total rental supply .







rs=w:1280

Palermo is the neighborhood with the largest rental offer Shutterstock



How much does it cost to rent in CABA?​

Rental prices for properties listed on real estate websites in Buenos Aires registered an average increase of 2.8 % in January , above inflation, which stood at 2.2% in January, according to the index published monthly by Zonaprop .

In numbers, the average rent for a one-bedroom apartment in the city is $474,633 per month , a two-bedroom apartment can be rented for $566,025 , while a three-bedroom apartment costs $761,505, according to the real estate platform.



www.buysellba.com
 
Back
Top